Business Economics

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Q.I A) ehat is 'monapaly' EKploia shart aia

manopaly defiaedA vasious based
Monopoy
accoxding do 'D
is
salvatoxe Accoxding ta
uhee
that markef
thexe munapaly
is single selling Cammed
ity fay which thexe axe close
Substitude
2) La maske
Simplewexd moncpaly is and
thexe is only ne siale sellex
lazge umbes of buy exS the
maketi is cont al ed hy selles
3)The woxd monopaly dexived fiom
gxeek 1oNO - PoLETNwhich
means issinaleand poleio mians
sellex.
4) Examples ofmonapaly Todiaa
Railuays RBI BankGoveinmeat nate
Supplyetc
Thexe axe Some featuxes af moAopay

Siagle Sellex 2Na close sub stitude

3) Pice makex
6) Conto owes the
he ma ket
Monopols ia shoxt
DLke monopolics , the Supphrss Shar- u
 efes to that pesidd in which timeis
So shoxt that monopalist cannot
change Fix factoss like machi ntyplant
2) Monapolis Can insease his outaut
xeS panSe to inckease indemandbu
chargiaq his Aa xiable factass, sinilaily
uhen deonad de cxea Sesthe manepolist
wil Ne duce his aud put hy xeducing
Vaxiable fachass b hy shouing slaing
doun the inteaseuse of fixed factas
Face any of Hhe 3
siduation the shoxt peiod

a) Supex axonalLefit La this citúction

manapaist have Supes noxnal poofit.
which means has àeyenue
moxe han Casthich cleaxlde indicates
Supex noxmal paafit
b)loxmal oafit L hat situatio
im eaxning DOxmal pfit hich
icdicates no pàafid

)loss: In this situatiaa fim is

fom he less which means
Suffeig
Costis than
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B) Explan hetypes ofEcono mies Scale

-)
means cldvan.
1) 'écongmiesScale' hich Gieof the
taats and Scale efexs to
Wnits.
2) he he pacduce ss start pxoducing o
laxge Scale (he lOhq he sdas ts
qetting Some well as
Same these eConomies
3) Econo mies Scale efess ta thE Cost
qets due
advantaqes
the
uhich
Jaxgex Sie paticip pàoducdi
nAs the psodwcdian
Cas the pìoductiaaaill alaays
8educe
4) This ecanomËes of Scale sefess
he dis advaataaes fiam SuffexS due
+ohe laxae Scale PAoductio
Thexe axe Tuo typs of Economies scale
1)Jatesnal Economies of Scale i T) efess ta
the benefids ensoy by a payiulax
fim due ois
benifiti axies Such
faom withiA
Ge ¡nd
he
SRlf. wheo he sell
ACxeast s paductian
Annenal
misod sCale
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measuxes Coapany's ef£iciencyof

2oducdian Thet e fficiency is qttaiaed
Thut
as the Campany impxaves out put he
the alage Cost pex pxoducts dxops
This ype of ecancomyof Scale is o
a Campany s
Cantsale d by its mahaq ement eam
Such pxoductoa
waxkfaxcexodactoA measux
and
machioy The factaxs thexefose
axe se indeptndent af the endixe iadustiy
Thexe types of Iadexnal Ecangmnes

1)Laboux fconoaies: This incxeases et{icitncy

Skils poductivty saves ime &
the cost of pooductiaa

2) Manaat xial Ecoo dmies i This will incxe as

apesaiánal eficercy and seduce Cast.
3) Maxkehins fcapaaies This hclos to
puchaGe atlowex and
3alliag qaods lost is law it that moarage
to Salet peaple
4)& fiaunciaonomies i J4 helps ta qet
4inance at Chepp date
iatexest

5) Technical Econamits ! Can mihize

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aCast of paaductiao by impxang Mac hiat

y dad echna loay
2)
EYeXnEconoaies T+ zefe xs t he
hene ids enou byo all te fism Aue to
Gny expansionaf the induxy as
hole TscqainaccuxA toe
and aindustx Ex+enod caNomies
ho+ ConsidexedHoone
ehét butshaxedbyall he Fimi
te andlindustxhenit epand
Thusextexnal
Monopo hse by iatconomy
Gaefixmand
ndustxy
Thexe axe ypt S of
ypes texnal coomiee
1) Economies G Cocaliation To hs
and gettng all tHe
henetsot cheap poessawgmateial
Asaspoxt Rtwhiich helps ta edce the
Cost pxodact con
2) Eonomi
fTafox metianI+ helps
+hxouqh
Cast
chwhich Saves nes

3)Economes
Some nCome
Ho xeducehe CoStoduc.
Q2 A) Pesfrci Campedidian in long k Shoxdun
Pexfect Camprlitiaa ia
) Petc Pes fect
d escsibes hoLw.CompeditianA lanq a
eact lona peyiad
1yeax
) Io long
L) Factoss of 2oductiaA mianS laad,
Labau capital
5) Ta Lana n all facta oadu
ctianwi chage alCaxdia
alcaxdiae to the
Yeqtements

Lwil have ecanomifs Scale

7) Lo laaq xn business may
+ed
distyhu
inallo.in SiduatiaA
a) Suoexnormnal poit -os loss &4VeAU
moxR

C) losS Reyenue lesS

lesS_& Ces4 is msxc
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Pexfect Cammdioa
Campeitian ia shoxt hun
1)Shox n mfans peiod of
less han yeas.
2) To Shoxt all factox o phodudiar
stable/ fixed.
3)factoy aA poduction means land
Iabour and capital.
4)Ta shoxt dun Pesfec campe ifiaa

a) loY mal paofit

b) Supesnsrmal pxofit
c) loss

5)Ta shaxt Maxinal

CMR)maqLnal Cost Cc Ave aqe
CAR) Averaqe Cost CA)s
Considexedto
to MC= TA2

Pice