ATTEMPT ALL QUESTIONS ON PRODUCTION ASSIGNMENT

1. (i)What is meant by the term production? (1 mk)

(ii)Mention three agents of production in an economy (3 mks)

2. Using examples distinguish between primary production and tertiary production (4 mks)
3. (i)Distinguish between quasi rent and economic rent (2 mks)

(ii)Outline two reasons why payment to land are referred to as economic rent (2 mks)

4. (i)Distinguish between economic rent and commercial rent (2 mks)

(ii)State any two factors that influence the level of economic rent (2 mks)

5. What contributions do factors of production make to national income in your country?(4 mks)
6. (i) What is meant by factor prices? (1 mk)

(ii) Name three different factor prices in an economy (3 mks)

7. (i) State the law of variable proportions (1 mk)

(ii)Mention any three assumptions underlying the law of variable proportions (3 mks)

8. (i)State the law of variable proportions (1 mk)

(ii) Under what circumstances may the above law fail to operate (3 mks)

9. (i)Distinguish between conglomerate merger and horizontal merger (2 mks)

(ii)State two advantages of horizontal merging of firms in your country (2 mks)

10. (i)Distinguish between ‘forward vertical’ and ‘backward vertical’ merging of firms (2 mks)

(ii)List any two advantages of merging of firms (2 mks)

11. Mention any four reasons for merging of firms ( 4 mks)
12. (a)Distinguish between lateral integration and conglomerate integration of firms (2 mks)

(b) Give any two conditions necessary for the success of lateral integration of firms (2 mks)

13. (i) Distinguish between excess capacity and over production (2 mks)

(ii) Mention two causes of excess capacity in an economy (2 mks)

14. In what ways do profits differ from returns to other factors of production? (4 mks)
15. (i) Distinguish between supernormal profits and zero economic profits (2 mks)

(ii)State two uses of profits in an economy (2 mks)

16. Mention four(4) reasons why the government may influence the location of an industry (4 mks)
17. (i)Distinguish between partnership and public limited company (2 mks)

(ii)Give two merits of partnership (2 mks)

18. (i)Distinguish between partnership and sole proprietorship (2 mks)

(ii)Give any two demerits of partnerships in your country (2 mks)

19. (i)Differentiate between a firm and an industry (2 mks)

(ii)Give two objectives of a firm (2 mks)

20. Explain the differences between :

(i)Real economies and pecuniary economies of scale (2mks)

(ii)Transfer earnings and transfer payments (2 mks)

21. (i)Differentiate between industrial inertia and localization of industries (2mks)

(ii)Give two reasons why firms operate at excess capacity (2 mks)