ECONOMICS OBJ:
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Economics Theory

1a &b)

2)

6 a)

economies of scale are the cost advantages that enterprises obtain due to their scale of operation ( typically measured by amount of output produced ) , with cost per unit of output decreasing with increasing scale .

6 bi )

Managerial economics is the ” application of the economic concepts and economic analysis to the problems of formulating rational managerial decisions ” .

6 bii )

Technical economies Lower costs per unit of output explained by expansion of all factors of production

6 c)

i ) Less Supervision :

A large – scale producer cannot pay full attention to every detail . Costs often rise on account of the dishonesty of employees or waste of material by them.

ii ) Individual Tastes Ignored :

Large – scale production is a mass production or standardised production . Goods of uniform quality are turned out irrespec tive of the requirements of individual customers .

iii ) Absence of Personal Element :

A large scale business is generally managed by paid employees . The owner is usually absent . The sympathy and personal touch , which ought to exist between the master

iv ) Possibility of Depression :

Large – scale production may result in overproduction . Production may exceed demand and cause depression and unem ployment.

4 a)

Net migration is the difference between the number of immigrants ( people coming into an area ) and the number of emigrants ( people leaving an area ) throughout the year .

4 b )

i ) Increased size of the Labour force in urban centres : The drift to the urban centres increase the number of people who are available for work in the companies, commercial institutions etc .

ii ) Urban unemployment is aggravated : The migration of many people to urban centres increases the number of people seeking employment in these urban areas

iii ) Explosion of demand in urban centres for social service : Demand for social facilities such as housing , medical facilities , education facilities , electricity , pipe – borne water etc will be far I ‘ m excess of their supplies

iv ) Increased government Expenditure : it would necessitate the diversion of funds from productive investment to the provision of social amenities thereby altering priorities

4 c)

i ) The establishment of industries and project to absorb the rural working population

ii ) Establishment of educational institutions in rural areas

7 a)

A tax is a mandatory financial charge or some other type of levy imposed upon a taxpayer by a governmental organization in order to fund various public expenditures .

7 b )

Tax evasion is the illegal evasion of taxes by individuals , corporations , and trusts while tax avoidance is the legal use of tax laws to reduce one ‘ s tax burden

7 c)

i ) National Security

ii ) Protecting Consumers

iii ) Infant Industries

iv ) Protecting Domestic Employment

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