TNSET 2024 Paper 2 Economics Question Paper (08-Mar-2025) (Shift-1)

Question 1

In short-run the firms' shut down point is

Accepted Answer

$P = AVC$

Answer

$P >AVC$

Answer

$P = AFC$

Answer

$P = AC$

Question 2

Find average variable cost (AVL) for the cost function $c(y)=y^2+1$

Accepted Answer

AVC = $y$

Answer

AVC = $y^2$

Answer

AVC = $y+1$

Answer

AVC = $1/y$

Question 3

Match the following concepts with authors: (1) The 'Kinked-Demand' model(a) Cournot(2) The 'Heroic' assumption(b) Bertrand(3) Other firm holds its price constant(c) P. Sweezy(4) Other firm holds its output constant(d) Chamberlin

Accepted Answer

(1)-(d), (2)-(a), (3)-(b), (4)-(c)

Answer

(1)-(c), (2)-(d), (3)-(b), (4)-(a)

Answer

(1)-(b), (2)-(a), (3)-(c), (4)-(d)

Answer

(1)-(c), (2)-(a), (3)-(b), (4)-(d)

Question 4

Characteristics of inferior goodsAssertion(A): Inferior good exhibits an upward-sloping demand curve, where an increase in price leads to an increase in the quantity demandedReason(R): For inferior goods, the income effect of a price increase is weaker than the substitution effect, leading consumers to purchase more of the good as price increases.

Accepted Answer

(A) is false, but (R) is true

Answer

Both (A) and (R) are true, and (R) is the correct explanation of (A)

Answer

Both (A) and (R) are true, but (R) is not the correct explanation of (A)

Answer

Both (A) and (R) is False

Question 5

The Nash equilibrium is a situation in which each player chooses

Accepted Answer

Dominant Strategy

Answer

Optimum Strategy

Answer

Pricing Strategy

Answer

No Strategy followed

(1) The 'Kinked-Demand' model	(a) Cournot
(2) The 'Heroic' assumption	(b) Bertrand
(3) Other firm holds its price constant	(c) P. Sweezy
(4) Other firm holds its output constant	(d) Chamberlin