Download App

The theory of the firm under perfect competition — Economics STD 11 Commerce — Question

CBSE BoardEnglish MediumSTD 11 CommerceEconomicsThe theory of the firm under perfect competition6 Marks
Question
How does technological progress affect the supply curve of a firm?
✓

Answer

The supply curve of a firm is a positive function of a state of technology. That is, if the technology available to the firm appreciates, more amount of output can be produced by the firm with the given levels of capital and labour. Due to such innovations or technological advancements, the firm will experience lower cost of production, which will lead to rightward downward shift of the MC curve. This will further lead to rightward shift of the firm’s supply curve. Thus, due to the appreciation and advancement of production techniques, the firm will produce more and more output that will be supplied at a given market price.

Need a full question paper?

Generate a complete, print-ready paper with questions like this in minutes — across 16+ boards, with answer keys.

Start Generating Free

Explore more

More "6 Marks Question" from The theory of the firm under perfect competition→The theory of the firm under perfect competition — all question types→Economics STD 11 Commerce question papers→CBSE Board STD 11 Commerce question papers→CBSE Board question paper generator→

Similar questions

Give formula for:
a. Simple mean in individual series by short cut method
b. Weighted mean
c. Simple mean in continuous series by direct method
d. Simple mean in discrete series by short cut method
e. Combined Mean 
f. Simple mean in continuous series by step deviation method
→
Explain the implications of the following in an oligopoly market:
  1. Barriers to entry of new firms.
  2. A few or a few big sellers.
→
A consumer consumes only two goods X and Y whose prices are ₹ 4 and ₹ 5 per unit respectively. If the consumer chooses a combination of the two goods with marginal utility of X equal to 5 and that of Y equal to 4, is the consumer in equilibrium? Give reasons. What will a rational consumer do in this situation? Use utility analysis.
→
Explain the conditions of consumer's equilibrium under utility analysis.
OR
Explain the conditions of consumer's equilibrium using marginal utility analysis.

OR
A consumer consumes only two goods $X$ and $Y.$ Explain the conditions of consumer's equilibrium using utility analysis.
→
Complete the following table.
Price (₹) 1 2 3 4 5 6 7
Units Sold 100 90 80 70 60 50 40
→
What would be an effect on supply curve of the following:
  1. Decrease in tax on product.
  2. Subsidy on production of goods.
  3. Rise in own price of a piece of goods.
→
Demand for electrical appliances like induction chulazas, heaters etc have increased due to increase in the price of LPG. However, in short run supply of these appliances remains constant. What will be the effect on the equilibrium price of these electrical appliances in the given scenario? In this case, which values are being highlighted by the demanders of electrical appliances?
→
Market for a good is in equilibrium. There is simultaneous "decrease" both in demand and supply of the good. Explain its effect on market price.
→
Complete the following table:
Output (units) Total Cost ₹ Average Variable Cost ₹ Marginal Cost ₹ Average Fixed Cost ₹
0 30      
1 .... .... 25 30
2 78 .... .... ....
3 .... 23 .... 10
4 .... .... 23 ....
5 150 .... .... 6
→
Find out the missing value of the variate for the following distribution whose mean is 31.87.
Value (X)12202733?54
Frequency (f)8164890308
→