Please answer these questions within 1 hour:

SECTION A 1. (a) Provide two examples each for horizontal and vertical demand curves from the real life. [02] (b) Why ceteris paribus is important in a subject like economics. Give 2 examples. [03] (c) A firm wants to target revenues. Explore which city is suitable for price decreasing policy for the firm who has outlets in Karachi, Lahore and Faisalabad. Use point elasticity method only. [05] Karachi Lahore Faisalabad Demand 100 45 80 60 110 110 Price 10 12 12 14 9 11 2. (a) Draw and explain all the demand curves whose elasticity would be one, greater than one, less than one, zero and infinity. [05] (b) Define Substitute Goods and differentiate it with perfect substitute goods. [2.5] (c) Define compliment Goods and differentiate it with perfect compliments goods. [2.5]3. (a) Graphically prove that a person can only maximize his utility if he consumes all the income. [04 ] (b) Provide at least 4 cases that shifts the iso cost line and hence creates new producer's equilibrium point? [04] (c) Differentiate marginal rate of substitution and marginal rate of technical substitution. [02] 4. Why the following statement are true / false? Reasons are must to provide. Draw graphs to support your answers where necessary. [2x5=10] (Note: no marks without logical reasoning) (a) Point of inflection refers to minimum point on total cost. (b) Shut down point and breakeven point can be equal in some situations. (c) Marginal Revenue equals marginal cost to maximize total revenue. (d) Cartel equilibrium situation for two firms is always different from the stable equilibrium. (e) Marginal revenue is equal to price is a characteristic of Oligopoly 5. (a) Being a sales director of Aanch Aag Industries, forecast demand for electricity for 9" quarter by using the following data. [04]. Quarter (X) 2 3 5 7 9 Gas Demand (Y) 12 15 20 25 27 33 40 (b) How much the seasonal adjustment will change the forecasted result of Q.5 (a)? [03] (c) Estimate the coefficient of determination and interpret the result. [03]