KIIT University 2008 micro-economics - Question Paper

1. Increase capacity utilization is available under what case?
2. Can we presume them of cartel in figure-1? If yes what sort of cartel?
3. How expense to sales ratio will vary for both the figure (1), (2)? What role price plays here?
4. If government decides and is successful in charging value equivalent of 10% as penalty for inventory of cement worth Rs. 15,000 cr. or more at zonal level lying unsold what would have been the maximum collection in a month?
5. What will be likely new market reaction in terms of demand and production related to question-4?
6. How the alleged cartel will react provided that government instructs inventory at any zone cannot exceed 50000 tonnes in a month? Do you think quarterly expenses to sales ratio can come to rescue of cement industry here?
7. Suppose GoI has announced 100% subsidy to transportation and freight cost for Indian Cement Industry.
(i) Price of which zone will fall
(ii) What will be new cartel understanding

8. Quote the line from the case which alleges Kinked demand curve for a few length in this industry?
9. Which part of the table would have been visibly more affected, had there been fight for market share?
10. Given the table depicts the actual avg. cement scene in India with 80% of market coverage, please state the minimum import price in Rs. for cement and the amount of imports in 00,000 tonnes which will not affect the cement scenario in India ?
11. How the cartel will react if it is compulsory to export 10% of production at existing prices?
12. Even if demand is growing, firms under cartel is constraining its supply to charge higher price, then why small firms don’t scale up their production to gain market share under no entry barrier regime?
13. Can smaller firms outside the cartel accused of providing strategic complements or external stability? What is the role of Concentration Index here?
14. State the link ranging from continuance of cartel , standardization of products and economies of scale for bigger and smaller firms in the cartel under increasing and falling demand? What will be the role of internal transparency for it?
15. What role smaller firms play to set rules for entry restriction by cartel ?

Earning:   Approval pending.