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q describe about theory of firmtheory of the firm is associated to comprehending how firms come into being what are their objectives how they act and
q what do you mean by theory of firmmicroeconomics especially the theory of firm assumed importance and attracted considerable attention in the early
q what is external diseconomiesthe expansion of an industry is likely to generate external diseconomies that raise the cost of production an increase
development of transportation and marketing facilitates the expansion of an industry may expedite the development of transportation and marketing
q development of skilled labour - external economiesas the industry grows training facilities for labour will increase this helps development of
q discovery of new technical know-howgrowth of technical know-how expansion of an industry may result in the discovery of new technical know-how as a
q cheapening of materials and equipmentsexpansion of an industry increases the demand for different kinds of materials and capital equipments this
q what do you mean by external economiesexternal economies arise outside the firm as a result of improvement in industrial environment in that the
q causes for diseconomies of scalethe most significant cause for diseconomies of scale is the diminishing returns to management as the output grows
q what is internal diseconomies of scaleinternal economies of scale exist only up to a certain size of the plant size of plant is called the optimum
q illustrate about pecuniary economiespecuniary economies which is monetary economies are those economies accrued by the firm from paying lower
q what is transport and storage economiesas the output increases unit cost of transportation of raw materials intermediate products and finished
q explain about managerial economieslarge scale production makes possible the division of managerial functions so there exists a production manager a
q what is marketing economiesthey are allied with selling of the product of the firm they arise from advertising economies because advertising
q explain about inventory economiesinventory economiesrole of inventories is to aid the firm in meeting random changes in the output and the input
q what is technical economiesthe significant technical economies result from the use of specialised capital equipment that comes into effect only
q explain about labour economieslabour economies as the size of output increases the firm enjoys labour economies because of a specialisation b
real economies are delineated as those which are associated with a reduction in the physical quantity of inputs like raw materials varying kinds of
economies and diseconomies of scale are of two types- external andinternal internal economies and diseconomies are those which a firm reaps as a
laws of returns to scale alludes to the long-run analysis of the laws of production in the long run output can be increased by varying all factors so
q concept of economies of scaleeconomies of scale refers to the cost advantages that a business attains because of expansion economies of scale is a
q total cost of factor combinationshere we try to find total cost of every factor combination and choose the one that has the least cost cost of
producers equilibrium or optimal combination of inputs the analysis of production function has demonstrated that alternative combinations of
q explain about isocost linein economics an isocost line signifies all combinations of inputs that cost the same total amount though similar to the
q what is production isoquantan isoquant demonstrates all those combinations of factors that produce the same level of output an isoquant is also