1. Explain what is meant by the Rational Area of Factor Used from a Production Function. Explain using a chart:

a). By illustrating how the Area is derived from Production Function to Average Product and Marginal Product.

b). Show where area II is in the graph, and explain why this area is a rational area for production, not other areas.

2. Explain why in a production process, where production only uses 2 kinds of inputs in an isoquant map, production must be within the area of rational factor used which is limited by 2 ridge lines, not outside that area. Why if we expand in production, we have to follow the expansion path?

3. Try to explain what is meant by the concept: Increasing return to scale, Constant return to scale and Decreasing return to scale in the production process by:. a) Using isoquant, and b). Using the Production function. .

4. Indonesia has been a country that imports rice, so during times of shortage, the price of rice tends to soar which greatly affects the ability of the poor. But now, this year it turns out that Indonesia has produced a surplus of domestic rice production that can be exported. This is a good thing, but it is different from the situation faced by farmers with this rice surplus which causes domestic prices to fall, especially during the main harvest. What should the government do when: a). Famine period, so that prices do not increase drastically, and b). The harvest period is high, so that the price of rice received by farmers does not fall below the basic price.

5. Why is it that in an oligopoly market that has a "kinked demand curve", the price level that occurs in the market experiences price rigidity, it is not easy to change, either to increase or to decrease, even though the production cost has increased or decreased. Explain this situation using a graph in an Equilibrium condition of the firm.

6. Try to explain by using a graph a state of balance in a company (equilibrium of the firm) in the market: perfect competition, if the company experiences:

a) Normal Profit b) Maximum profit c) Losss.

7. Try to explain by using a graph of a state of balance in a company that is in a "monopolistic competition" if the company experiences: a). Normal profit; b). Maximum profit c). Loss

8 Explain the concepts: consumer surplus and producer surplus using the help of charts

9. Explain the concept and meaning of General Equilibrium (of production and exchange) and Welfare Economics. Explain where and how Maximum Welfare will be achieved.

10. a. What is meant by "inflection point" in production function?

b. What is meant by "social loss" as a result of the monopoly market.

c. What is meant by the shut down point of a company?

d. What is meant by an isocot or a budget line?

e. What is the producer equilibrium?

10. Explain how the consumer equilibrium occurs from consumers who consume two kinds of goods using an indifference curve.

11. Explain the concept of the substitution effect; income effect; and price effect in consumer behavior analysis.