NCERT Solutions Class 12 Economics Producer Equilibrium. NCERT book for Economics in class 12 is strongly recommened by teachers and The NCERT solutions for class 12 Economics free in PDF made by teachers of the best schools in India. These solutions are carefully compiled to give detailed understanding of the concepts and also steps of solutions. The NCERT solutions are free to download in pdf format. Please refer to the download link below to download the pdf file and also refer to other chapters and subjects to get the solutions to Economics NCERT book questions and exercises.
Question 1. What conditions must hold if a profit- maximizing firm produces positive output in a competitive market?
Or Explain the producer’s equilibrium with MR/MC approach (when Price remains constant with the rise in output). Or
Explain the conditions of a producer’s equilibrium in terms of marginal cost and marginal revenue. Use diagram [CBSE Sample Paper 2012, 13] Or
Why is the equality between marginal cost and marginal revenue necessary for a firm to be in equilibrium? Is it sufficient to ensure equilibrium? Explain. [CBSE 2015} Or Elaborate the implication of the conditions of equilibrium of a firm. [CBSE Sample Paper 2016]
Answer: The conditions must hold if a profit maximizing firm produces positive output in a competitive market when price is constant under MR/MC approach is determined where,
(i) MR = MC (ii) MC must be rising
According to Table, both the conditions of equilibrium are satisfied at 4 units of output. MC is equal to MR and MC is rising. MC is more than MR when output is produced after 4 units of output. So, Producer’s Equilibrium will be achieved at 4 units of output. However, MR is equal to MC at 2 units of output also. But, second condition is not fulfilled here.
Let us understand the determination of equilibrium with the help of a diagram:
Producer’s Equilibrium is determined at OQ level of output corresponding to point E as at
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