ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD

(Department of Economics)

WARNING
1. PLAGIARISM OR HIRING OF GHOST WRITER(S) FOR SOLVING
THE ASSIGNMENT(S) WILL DEBAR THE STUDENT FROM AWARD
OF DEGREE/CERTIFICATE, IF FOUND AT ANY STAGE.
2. SUBMITTING ASSIGNMENTS BORROWED OR STOLEN FROM
OTHER(S) AS ONE’S OWN WILL BE PENALIZED AS DEFINED IN
“AIOU PLAGIARISM POLICY”.
Course: Economics (402) Semester: Spring, 2020
Level: B.A Total Marks: 100
Pass Marks: 40
ASSIGNMENT No. 1
(Unit 1–4)

Q.1 Explain different definitions of economics. Also furnish a logical comparison

among them. (20)

Q.2 a) What is utility? Can utility be measured? If yes then explain how? (10)
b) Explain the division of price effect into substitution effect and income effect
in the cases of normal good and inferior good. (10)

Q.3 a) What is meant by point elasticity and arc- elasticity of demand? Explain with
help of diagram and formula. (06)
b) Given the supply and demand equations: (14)

Qs = 12 + 2p
Qd = 60 – 4p

Estimate:
i) Equilibrium price and quantity
ii) Elasticities of demand and supply at equilibrium position.

Q.4 a) Differentiate between average cost and marginal cost with the help of a table
and diagram. (10)
b) Differentiate between total revenue and average revenue under perfect
competition and imperfect competition with the help of table and
diagram. (10)

1
Q.5 Write a note on the following: (5+5+5+5)
a) Professor Robin’s definition of economics.
b) Law of equi- marginal utility.
c) Utility versus satisfaction.
d) Long- run supply curve.

ASSIGNMENT No. 2
(Unit 5–8)
Q.1 Can you differentiate between a firm and a market? Also discuss those factors
which determine the scope of a market. (20)

Q.2 Explain the equilibrium of a firm under perfect competition in the short- run and
long- run. (20)

Q.3 Define rent. Enumerate its different types and discuss Ricardian theory of rent. (20)

Q.4 Define wage and its two major types. Also discuss different theories of wages in
detail. (20)

Q.5 a) What is meant by a weighted index number? Explain the steps for
constructing an index numbers in detail. (10)

b) Write down the formulas of weighted index number? Calculate the index
number by Laspeyer’s formula from the following table, taking 2011 as the
base year. (10)

Year Price of Sugar / Quantity of Sugar

Kg (in rupees) (Kg)
2012 35 500
2013 40 600
2014 45 800
2015 47 850
2016 50 800
2017 55 900
2018 60 1000
2019 62 1000
2020 65 950

2
 ASSIGNMENT No. 3
(Unit 9–13)

Q.1 Explain different concepts of national income. Also discuss different methods of
measuring national income. (20)

Q.2 What is accelerator? Discuss its measurement, elements, limitations and its effects
on investment. Also briefly discuss about the interaction between multiplier and
accelerator. (20)

Q.3 What is money? Also discuss in detail the different functions of money. (20)

Q.4 Discuss about the types of banks. Also discuss in detail the functions of a central
bank. (20)

Q.5 Write notes on the following:

i. Exchange rate (10)
ii. Balance of trade. (10)

ASSIGNMENT No. 4
(Unit 14–18)

Q.1 What are the instruments of commercial policy? Also write a detailed note on the
types of custom duty and import quota. (20)

Q.2 What are public revenues and their important sources? Also discuss the canons of
taxation in detail. (20)

Q.3 Define fiscal policy. Also write a note on the importance and objectives of fiscal
policy. (20)

Q.4 What is meant by economic development? Also discuss in detail different

economic factors which play important role in the development of a country. (20)

Q.5 Define economic planning? Also discuss in detail the process of economic planning
in a country like Pakistan. (20)

AIOU-AS-72(20)PPU-09-03-2020-Quantity