uestion One

$($a$)$ What is production function?

$($b$)$ Explain the law of diminishing returns.

$($c$)$ Considering the three stages of the law of variable proportion, when should rational firm produce?

question Two

$($i$)$ What are the essential characteristics of perfectly competitive firms?

$($ii$)$ With appropriate diagram, clearly show the short$-$run profit$-$maximizing output perfectly competitive firm.

Question Three

$($a$)$ Explain the term "market".

$($b$)$ Write short note on the following with appropriate examples: Perfect market, Monopoly Monopolistic Competition; Oligopoly; Duopoly; Monopsony; and Duopsony.

Question Four

Given the Cobb$-$Douglas production function: $Q=100K^{\text{@}4}{L}^{06},$ derive mathematically the outpu elasticities of capital $($ K $)$ and labour $($ L $),$ respectively.