Simple answers but detailed will do.

Thank you.

1. (a) State and explain the assumptions underlying the theory of Imperfect Competition. (25 marks) (b) Draw the demand curve which faces a firm in imperfect competition and justify its shape. (10 marks) (c) Discuss, with the aid of a clearly labelled diagram, the implications of the assumptions in (a) above, on the equilibrium of the firm in the long run under conditions of imperfect competition. (30 marks) (d) State ONE FEATURE of this firm in long run equilibrium which would be common to a firm in long run equilibrium under EITHER perfect competition OR monopoly. (10 marks)3. (a) State FOUR factors that affect the supply of a good, other than the price of the good itself, and explain how each factor affects supply. (25 marks) (b) State and explain the principal economic assumptions made about consumer behaviour. (25 marks) (c) The law of diminishing marginal utility states that as additional units of a good are consumed the marginal utility of this good will eventually decline. (i) State and explain the assumptions underlying the law of diminishing marginal utility. (ii) Give TWO examples of commodities which do not comply with this law. Justify each choice with a brief explanation.2. (a) Define what is meant by price elasticity of demand. (10 marks) (b) A consumer buys 80 units of a good when the price is $1.50. The price increases to f1.75 and the consumer now buys 70 units. (i) Using the formula below, calculate the consumer's price elasticity of demand. Show all your workings. AQ P1 + P2 AP X Q1 + Q2 (ii) Is demand for this good elastic, inelastic or unitary elastic? (iii) The seller of the above good wishes to earn maximum revenue. What changes, if any, should the seller make in the selling price of the good to earn maximum revenue? Explain your answer. (35 marks) (c) State and explain FOUR factors that affect price elasticity of demand. (30 marks)4. (a) A principal factor determining the wages to be paid to a worker is the Marginal Revenue Productivity of Labour (MRP). (i) Explain what is meant by the underlined term. (ii) Discuss the factors, other than MRP, which influence the wage rates paid to different categories of workers. (30 marks) (b) How appropriate is MRP for setting wages in the public sector? Explain your answer. (20 marks) (c) At present, the demand for labour exceeds the supply of labour in certain sectors of the Irish Economy. Discuss the possible economic effects which this situation may have on the Irish economy. (25 marks) [75 marks] 5. (a) Define clearly any THREE of the following terms: (i) Invisible Exports; (ii) Tariffs; (iii) Balance of Payments on Current Account; (iv) Balance of Payments on Capital Account. (25 marks) (b) Irish exports have been steadily rising in recent years. Discuss how this development affects each of the following: (i) the level of Irish imports; (ii) the amount of borrowing by the Irish government. (25 marks) (c) Discuss the possible effects on the Irish economy of the EURO declining in value relative to other international currencies. (25 marks)