"ECONOMICS INTERVIEW QUESTIONS AND
ANSWERS" - By MaddaliSwetha
DEFINED COST CONTROL?
Cost
Control is defined as the regulation by execution action of the costs of
operating an undertaking. Cost control is exercised through numerous techniques
some of which are standard. Costing, Budgetary control, Inventory control,
Quality Control and performance evaluation.
Thus,Cost
control refers to management's effort to influence the actions of individuals
who are responsible for performing tasks, incurring costs, and generating
revenues. First managers plan the way they want people to perform, then they
implement procedures to determine whether actual performance complies with
these plans. Cost control is a continuous process that begins with the annual
budget.
EXPLAIN COST REDUCTION?
Cost
reduction implies profit optimizing through economics in costs of manufactures,
Administration, selling and distribution. We know that profit can be maximized
either by increasing sales or by reducing costs. In a monopoly market it may be
possible to increase price to earn profits.
In a competitive situation it is
not possible to increase price significantly; Growth of profit would,
therefore, depend mainly on the extent of cost reduction. Even when monopoly
conditions prevail at present these may not exist permanently.
DEFINED PRICE CONTROL?
Price
control has been defined as the government effort to restrict the prices of
commodities in the market. The restriction can act on either the lowest prices
or the highest prices. When the government decide to restrict the highest price
that a good or service should be sold at in the market then this type of
restriction is known as the price ceiling. Price floor on the other hand is the
restriction imposed by the government on the minimum prices that a goods or
service should be sold at in the market.
DEFINED MICRO ECONOMICS?
Microeconomics
examines the impact that economic choices made by individuals, businesses and
industries have on resource allocation and the supply and demand of goods and
services in market economies. Because supply and demand determine the price of
goods and services, microeconomics also studies how prices factor into economic
decisions, and how those decisions, in turn, affect prices.
EXPLAIN MACROECONOMICS?
Macroeconomics
refers to how economists in this field analyze the structure and function of
large-scale economies as a whole, whether regional, national or global.
Macroeconomics examines the complex interplay between factors such as national
income and savings, gross domestic product, gross national product, consumer
and producer price indexes, consumption, unemployment, foreign trade,
inflation, investment and international finance.
EXPLAIN ABOUT THE LAW OF SUPPLY AND
DEMAND?
The
Law of Supply and Demand – For a market economy to function, producers must
supply the goods that consumers want. This is known as the law of supply and
demand. “Supply” refers to the amount of goods a market can produce, while “demand”
refers to the amount of goods consumers are willing to buy. Together, these two
powerful market forces form the main principle that underlies all economic
theory.
DEFINED ECONOMICS?
Economics
is the science that deals with the production, allocation, and use of goods and
services. It is important to study how resources can best be distributed to
meet the needs of the greatest number of people. As we are more connected
globally to one another, the study of economics becomes extremely important.
While there are many subdivisions in the study of economics, two major ones are
macroeconomics and microeconomics. Macroeconomics is the study of the entire
system of economics. Microeconomics is the study of how the systems affect one
business or parts of the economic system.
THE FATHER OF ECONOMIC?
Adam
Smith considered as the father of modern economics.
Karl Marx – father of economic thought
DEFINED MANAGERIAL ECONOMICS?
Managerial Economics is the application of economic
theory and methodology to managerial decision making problems within various
organizational settings such as a firm or a government agency. Managerial economics is a social science discipline that
combines the economics theory, concepts and known business practices. Hence Managerial economics is the "application of the
economic concepts and economic analysis to the problems of formulating rational
managerial decisions"
Managerial decision areas include:
*Assessment of investible funds
*Selecting business area
*Choice of product
*Determining optimum output
*Determining price of product
*Determining input-combination and technology
*Sales promotion
DEFINED OF DEMAND?
An
economic principle that describes a consumer's desire and willingness to pay a
price for a specific good or service.
DEFINITION OF LAW OF DEMAND?
The
law of demand states that other factors being constant .price and quantity
demand of any good and service are inversely related to each other.
Definition: The law of demand states that other
factors being constant, price and quantity demand of any good and service are
inversely related to each other. When the price of a product increases, the
demand for the same product will fall.
Description: Law of demand explains consumer choice
behavior when the price changes. In the market, assuming other factors
affecting demand being constant, when the price of a good rises, it leads to a
fall in the demand of that good. This is the natural consumer choice behavior.
This happens because a consumer hesitates to spend more for the good with the
fear of going out of cash.
The
above diagram shows the demand curve which is downward sloping. Clearly when
the price of the commodity increases from price p3 to p2, then its quantity
demand comes down from Q3 to Q2 and then to Q3 and vice versa. Quantity demand
comes down from Q3 to Q2 and then to Q3 and vice versa.
DEFINITION OF SUPPLY?
The
total amount of a good or service available for purchase; along with demand,
one of the two key determinants of price.
DEFINITION OF LAW OF SUPPLY?
Law of supply states that other factors remaining constant, price and quantity supplied of a good are directly related to each other.
Definition: Law of supply states that other factors remaining constant, price and quantity supplied of a good are directly related to each other. In other words, when the price paid by buyers for a good rises, then suppliers increase the supply of that good in the market.
Description: Law of supply depicts the producer behavior at the time of changes in the prices of goods and services. When the price of a good rises, the supplier increases the supply in order to earn a profit because of higher prices.
The above diagram shows the supply curve that is upward sloping (positive relation between the price and the quantity supplied). When the price of the good was at P3, suppliers were supplying Q3 quantity. As the price starts rising, the quantity supplied also starts rising.
sources:
www.google.com -images
www.google.com -images
No comments:
Post a Comment