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Price Determination of Factors of Production (Numerical Problems With Solutions)

PRICE DETERMINATION OF FACTORS OF PRODUCTION (NUMERICAL QUESTIONS)

This article contains all the important numerical problems and their solutions for the theory of price determination of factors of production of economics of class 12. 

  1. If the produce of 1 Ropani of higher graded land owned by landlord in a year is 80 quintals of maize and the produce of a marginal land of same area in the same year is 60 quintals of maize, then find out the rent earned by the landlord.
    Ans: 20 quintals maize

    Solution
    Given
    Produce of landlord's land = 80 quintals maize
    Produce of marginal land = 60 quintals maize
    We know that
    Rent = Produce of higher graded land – Produce of marginal land
    = 80 quintals maize – 60 quintals maize
    = 20 quintals maize

  1. If the produce of 1 Ropani of land owned by landlord in a year is 40 quintals of maize and the produce of a marginal land of same area in the same year is 40 quintals of maize, then find out the rent earned by the landlord.
    Solution

    Given
    Produce of landlord's land = 40 quintals maize
    Produce of marginal land = 40 quintals maize
    We know that
    Rent = Produce of higher graded land – Produce of marginal land
    = 40 quintals maize – 40 quintals maize
    = 0
    Therefore, landlord's land is no rent land.

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  1. If the wage fund Rs. 40,000 is fixed and number of workers is 80, then what would be the wage rate?
    Solution

    Given
    Wage fund (W) = Rs. 40,000
    Number of workers (N) = 80
    We know that
    Wage rate = WN\frac{W}{N}
    = 40,00080\frac{40,000}{80} = Rs. 500

  1. The wage fund is Rs. 30,000 is fixed and the number of workers is 50. Find the wage rate while the number of worker's increases by 10.
    Solution

    Given
    Wage fund (W) = Rs. 30,000
    Number of workers (N) = 50 + 10 = 60
    We know that
    Wage rate = WN\frac{W}{N}
    = 30,00060\frac{30,000}{60} = Rs. 500

  1. Find the equilibrium rate of interest from the given investment and saving schedules.
Rate of interest (%) Investment (Rs. in crores) Saving (Rs. in crores)
8 40 90
7 50 70
6 60 60
5 70 50
4 80 40

Solution

Here, investment and saving are equal at 6% interest rate. Therefore, equilibrium rate of interest is 6%.

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