Answer the following problems.

problem 1) With the help of suitable diagram, describe circular flow of Income and Expenditure for a two-sector economy.

problem 2) State Price Elasticity of Demand. What are its types?

problem 3) Derive Long Run Average Cost Curve (LAC) from the Short Run Average Cost Curves (SACs).

problem 4) State and describe features of Perfect Competition.

problem 5) Describe determination of Wages under Imperfect Competition.

problem 6) Define Supply. Describe in detail the factors affecting Supply.

problem 7) Critically examine Liquidity Preference Theory of Interest Determination.

problem 8) Differentiate between Economies and Diseconomies of Scale. Give appropriate exs.

problem 9) prepare brief note:

(a) Dynamic Theory of Profit

(b) Exceptions to the Law of Demand

(c) Basic Economic Problems

(d) Difference between Micro and Macro-economics

(e) Selling Costs under Monopolistic Competition

(f) Relation between AR and MR in Imperfect Competition