Distinguish between positive economics and normative economics, with

suitable examples.

Under imperfect competition, Average Revenue (AR) remains _________Marginal Revenue (MR). (Fill up the blank)

OR

‘‘For a firm to be in equilibrium, Marginal Revenue (MR) and Marginal Cost (MC) must be _________ and beyond that level of output Marginal Cost must be _________.’’ (Fill up the blank)

If the supply curve is a straight line parallel to the vertical axis (Y-axis),

the supply of the good is called _________. (Fill up the blank)

(a) Unitary Elastic Supply

(b) Perfectly Elastic Supply

(c) Perfectly Inelastic Supply

(d) Perfectly Elastic Demand

Explain the law of diminishing marginal utility, with the help of a hypothetical schedule.

OR

Elaborate the law of demand, with the help of a hypothetical schedule.

The market for a good is in equilibrium. How would an increase in an input price affect the equilibrium price and equilibrium quantity, keeping other factors constant? Explain using a diagram.