Read the Instructions carefully

Below are few questions which will act as leading questions for your oral examination (viva). Please
be clear that the viva will not be limited to these questions only but will be broadly related to the
concepts mentioned in these questions. I will most likely cross question you, following up on the
answers you give.

Viva will be conducted individually and will last up to 15 minutes per person.

You will be graded on clarity of your answers which shows a thorough understanding of the
concepts. I will allow you to use the Zoom whiteboard to sketch diagrams or do any calculations if
needed. While you may have notes prepared and use them, there is likely to be limited time for you
to answer the questions, so it is best to understand the material beforehand and not rely too much
on written/online notes.

It will be mandatory for you to keep your videos on throughout the duration of the viva.

You will not be allowed to present any material such as power-point presentations/word/excel files.

None of the questions require you to memorize anything so do not waste time in doing so. It is only
to test your understanding and ability to explain the concept.

I will not be assisting you in preparing for these questions.

Question 1
(a) Why is Perfect Competition considered to display high level of economic efficiency?
(b) How does monopoly result in a dead-weight loss? Illustrate with diagram.
(a) How is oligopoly different from monopolistic competition?
(b) Illustrate and explain how the oligopolistic firms determines their collective profit by
maximizing price and output levels when they collude and act like a cartel (monopoly).

Question 2
(a) What is the difference between a quota and a subsidy?
(b) Explain, using a demand and supply diagram, what effect is likely to occur in a market if the
government introduces a subsidy in the production of a good.
(c) Discuss whether the elasticity of supply of manufactured goods is likely to be greater than
the elasticity of supply of agricultural goods.
(d) Can a business change the price elasticity of its demand? If yes, how?
(e) How would the knowledge of PED be useful for a phone seller?
Question 3

(a) An economy is at the brink of running out of an important natural resource at a time when it
is introducing improved technology. Explain how these events will affect the economy’s
production possibility curve.
(b) Explain using a PPF why scarcity makes choices inevitable for the firms and how each choice
has an opportunity cost?
(c) How are resources allocated in a market economy?
(d) What are the possible undesirable outcomes of a pure market economy?

Question 4

(a) What are the potential problems that may be caused by asymmetric information?
(b) According to theory of Nash Equilibrium, how does a player decide what its strategic choice
should be? Why is this Equilibrium important?
(c) Name one demand forecasting technique and when is it most suitable to use?

Question 5
(a) How is revenue maximization goal different from a profit maximization goal. How would you
calculate the output which will achieve either?
(b) If you are a firm entering a new market (new product category/new geography), what are
three factors you will consider before determining pricing of the product?
(c) How does a firm choose among first, second and third degree price discrimination?