Consider a market with two firms. In the following table, columns labelled as SS₁ and SS₂ give the supply schedules of firm 1 and firm 2 respectively. Compute the market supply schedule.

Price (Rs)	SS1(Kg)	SS2 (Kg)
0	0	0
1	0	0
2	0	0
3	1	0
4	2	0.5
5	3	1
6	4	1.5
7	5	2
8	6	2.5

3

(a)

How does technological progress affect the supply curve of a firm?

3

(a)

How does an increase in price of an input affect the supply curve of a firm?

3

(a)

What does the price elasticity of supply mean? How do we measure it?

3

(a)

What is the supply curve of a firm in the short run?

3

(a)

At the market price of Rs.10, a firm supplies 4 units of output. The market price increases to Rs.30. The price elasticity of the firm's supply is 1.25. What quantity will the firm supply at the new price?

3

(a)

A firm earns a revenue of Rs.50 when the market price of a good is Rs.10. The market price increases to Rs.15 and the firm now earns a revenue of Rs.150. What is the price elasticity of the firm's supply curve?

3

(a)

Explain the concept of law of supply.

3

(a)

Explain how changes in prices of inputs influence the supply of a product.

3

(a)

Explain effect of 'change in prices' of other products on supply of a given product.

3

(a)

Explain effect of technological changes on supply of a product.

3

(a)

Differentiate between increase in supply ·and expansion in supply [increase in quantity supplied].

3

(a)

PES of a commodity is 5. A producer sells 500 units of a good at a price of  Rs. 5 per unit. How much wil be willing to sell at the price of Rs.6 per unit?

3

(a)

The price elasticity of supply of a commodity is 2.5. At a price of Rs.5 per unit, its quantity supplied is 300 units. calculate its quantity supplied at a price of Rs.4 per unit.

3

(a)

When price of a commodity falls by 50%, the quantity supplied decreases by 100%. Find out its price elasticity of supply

3

(a)

The price of a commodity rises from Rs.5 per unit to Rs.6 per unit. Consequently, its supply increases by 20%. Comment on PES.

3

(a)

Price of commodity A is Rs.10 per unit and total revenue at this price is Rs.1,600. When its price rises by 20 percent, total revenue increases by Rs.800. Calculate its price elasticity of supply

3

(a)

Distinguish between stock and supply.

3

(a)

State factors that can cause a rightward shift of supply curve.

3

(a)

State factors for leftward shift of supply curve.

3

(a)