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38 views2 pages

HS1345

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gk3335000
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NATIONAL INSTITUTE OF TECHNOLOGY ROURKELA

MID-SEMESTER EXAMINATION 2023-24 (AUTUMN SEMESTER)

Subject Code: HS1345 Dept. Code: HS


Subject Name: Optimization Theory in Economics Full Marks: 30
Duration of Examination: 2 hours

Q.N. Section – A Marks


ANSWER ANY SEVEN 7×3=21

1 Determine the equilibrium price and quantity of the following functions:

i) Supply: Y = x2 + 5x + 1, Demand: Y = 9 – 2x2


ii) Supply: Y = 8x + 7, Demand: Y = 27 + x2
iii) Supply: 4Y = x2 + 2x + 5, Demand: Y = -2x + 20

2 Evaluate the following limits:


√2+𝑥−√2
i) 𝑙𝑖𝑚
𝑥→0 𝑥
𝑥
ii) 𝑙𝑖𝑚
𝑥→0 √𝑎+𝑥−√𝑎−𝑥

3 Determine the differential coefficients of the quotient of the following


functions w.r.t x.
3+5 𝑙𝑜𝑔 𝑥
i) 𝑦 = 𝑥 2 +3
1
𝑥 2 +2
ii) 𝑦= 1
𝑥2

4 Find the 2nd and 3rd order differential coefficients w.r.t x when,
2
𝑦 = 𝑥ⅇ 𝑥

5 Determine the minima and maxima of the following function.


2 1
𝑦 = 𝑥 3 + 𝑥 2 − 6𝑥 + 8
3 2

6 The pattern of total revenue is described by the relation, y = 50,00,000 –


(x – 2,000)2, where, y is the total revenue and x, the number of units sold.
From these, find (i) the number of units to be sold to maximize the
revenue, (ii) the maximum value of revenue, and (iii) the total revenue
when 2,500 units are sold.

7 If the demand function of a monopolist is 3q = 98 – 4p and the average


cost is 3q +2, where q is the output and p, the price, find the maximum
profit of the monopolist.

8 The demand for a commodity is given by x = 48 – 3p2. Find the point


elasticity of demand when p = 3. If the price of 3 is decreased by 5%,
determine the relative increase in demand, hence an approximation to the
elasticity of demand.

!!! ALL THE BEST !!!


1 1
9 The production function of a firm is given by 𝑃 = 20𝐿3 𝐾 3 . Find the
average and the marginal product, and evaluate them when L = 8, and K
= 27. Also, interpret the result.

10 The demand and supply functions, respectively, are:

Pd = (6 – x)2 and Ps = 14 + x

Find the consumer’s surplus if the demand and price are determined
under (i) perfect competition and (ii) Monopoly (so as to maximize
profit), and the supply cost is identified with the marginal cost function.

Section – B Marks
COMPULSORY 1×9=9

11 Given the demand and per unit cost of production as the following:
P = A – B*Q and AC = MC = C
Prove that:
PM > PPC
QM < QPC
πM > πPC
SWM < SWPC
Here M = Monopoly, PC = Perfect Competition; P = Price per unit, Q =
quantity of output produced, π = Profit, and SW = Social Welfare.

!!! ALL THE BEST !!!

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