Subject Code: PME1A Paper: Managerial economics Specific Instructions:

Answer all the four questions. Marks allotted 100. Each Question carries equal marks.

Word limit is 250-300 words

General Instructions:
The Student should submit this assignment in the handwritten form (not in the typed format) The Student should submit this assignment within the time specified by the exam dept Each Question mentioned in this assignment should be answered within the word limit specified The student should only use the Rule sheet papers for answering the questions. The student should attach this assignment paper with the answered papers.

Failure to comply with the above Five instructions would lead to rejection of assignment.

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Question No1 In normal and formal economic theory, we often assume profit maximization. In reality , the firm do not maximize profit; in fact they cannot. Comment. Question No2 The discounting principle and incremental cost concept are both special applications of opportunity cost reasoning. Explain. Question No3 The quantity demanded of any good appears to depend upon utility , price and income.? Elucidate with the help of an industry example? Question No4 Write notes on the each of the following: a) Rule of thump pricing. b) Transfer pricing c) Mark up pricing d) Boumols sales revenue maximization model e) Marris model of managerial enterprise.