Answer the following problems.
problem 1) “Managerial Economics is the integration of economic theory with business practice for the purpose of facilitating decision making and forward planning by management”. Describe in detail
problem 2) Describe the following concepts:
a) Arc Elasticity and Point Elasticity
b) Price elasticity and Cross Elasticity
c) Income Elasticity
d) How the above concepts of elasticity are useful for managers in decision making?
problem 3) How is price of the commodity determined in competitive market? Demonstrate and describe how the short run equilibrium of a firm is different from its long run equilibrium in different market structures?
problem 4) Differentiate between Law of Variable Proportion and Returns to Scale using appropriate schedule and diagrams.
problem 5) prepare brief notes on the following:
a) Price Discrimination
b) Short run and long run objectives of a firm
c) Demand Forecasting
d) Why do Demand curve slopes down?