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PPE611S - PRINCIPLES OF PRDUCTION ECONOMICS - 2ND OPP - JUNE 2025 |
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nAmlBIA unlVERSITY
OF SCIEnCE Ano
FACULTY OF HEALTH, NATURAL RESOURCES AND APPLIED SCIENCES
DEPARTMENT OF AGRICULTURAL SCIENCES AND AGRIBUSINESS
QUALIFICATION: BACHELOR OF SCIENCE IN AGRICULTURE
QUALIFICATION CODE: 07BAGA
LEVEL: 6
COURSE CODE: PPE621S
SESSION: JULY2025
COURSE NAME: PRINCIPLESOF PRODUCTION
ECONOMICS
PAPER: 1
DURATION: 3 HOURS
MARKS: 100
EXAMINER
MODERATOR
SECOND OPPORTUNITY EXAMINATION QUESTION PAPER
DR TEOFILUSSHIIMI
PROF.THINAH MOYO
INSTRUCTIONS
1. This question paper consists of five (5) questions.
2. Answer ALL questions in blue or black ink.
3. Start each question on a new page in your answer booklet.
THIS QUESTION PAPER CONSISTS OF 4 PAGES (Including this front page)
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Question 1
(a) Find the derivative of the following functions.
(i)y = 80 + 4.2x 2
= (ii) y 5 + O.Sx - 4x 2 + 6x 3
= (iii) y x + 4x 2 - 0.2x 3
= (iv) y Bx + 2x 2 - 3x 3
(2 Marks)
(2 Marks)
(2 Marks)
(2 Marks)
(v) y = 4 + 24x - 4x 2
(2 Marks)
(b) Suppose the production function for beetroot yield and Nitrogen application is given as:
y = SO+ 4.93x 3
(i) Find theist derivative of the production function with reference to MPP.
(2 Marks)
(ii) Given the first derivative of the production function with reference to MPP, interpret the
function in relation to:
(1) Direction of the MPP graph.
(2 Marks)
(2) The law of diminishing marginal returns.
(2 Marks)
(3) The influence of additional units of Nitrogen in relation to beetroot yield.
(2 Marks)
(iii) Calculate the yield of beetroot when you add 4 units of kraal manure.
(2 Marks)
Sub-Total
(20 Marks)
Question 2
Below is the production graph, please copy the graph as it is in your answering book and
answer the questions that follows.
y
.::,
n.
;)
0
X
Units ofVarfablcfac:tor
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{a) Explain the relationship of total output and the units of the variable factor? {3 Marks)
{b) With the aid of lines and labels, indicate three stages of production on
the graph.
(c) Clearly indicate on the graph where the inflexion point is found.
{3 Marks)
{2 Marks)
{d) By shading, indicate the stage in which the rational firm will operate?
{2 Marks)
{e) Explain why the rational firm should operate at that stage?
{2 Marks)
{f) Explain why TPP declines as units of the variable factor increase?
{2 Marks)
{g) Discuss the relationship of TPP, MPP and APP in stage I and stages II of the
production function.
(6 Marks)
Sub-Total
Question 3
(20 Marks)
{a) Determine whether each of the following production functions exhibits increasing,
constant or decreasing returns to scale. Show your calculations.
(10 Marks)
(i) Q =l .Sxo.1yo.3
(ii) Q =0.4x + 0.5y
(iii) Q = 2.0.xy
(iv) Q = l .Oxo6yo.s
(v) Q = 2xoAyo3
(b) Consider the cost function.
vc = 150Q - 6Q 2 + 0.3Q3
If the fixed cost is N$150, determine the following cost functions.
(i) Total cost function
(ii) Average fixed cost
(iii) Average variable cost
(iv) Average total cost
(v) Marginal cost
Sub-Total
(10 Marks)
(20 Marks)
Question 4
Mr Thomas produces maize from a 10 Ha piece of land. He took a loan of N$100 000.00 from
Agribank. He has a record of all his yields and his total variable cost for five production
seasons. The Price of maize is N$8, and he pays an installment of N$100 every month.
(a) Assuming that the loan is the only fixed investment, complete the Table below: (10 Marks)
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Yield
TVC
FC
TC
20
80
30
120
40
160
so
200
(b) Distinguish between the following concepts.
(i) lsoquant and lsocost.
(ii) Isocline and expansion path.
(iii) Technical and Allocative efficiency
(iv) Productivity and productive efficiency.
(c) Mention any characteristic of an isoquant.
Sub-Total
AVC
AFC
ATC
{8 Marks)
{2 Marks)
(20 Marks)
Question 5
The table below shows the relationship between Total Physical Product {TPP), Average
Physical Product (APP), Marginal Physical Product {MPP) and Marginal Value Product {MVP).
If the price of output is N$2 per unit of input,
(a) complete the Table.
{10 Marks)
Input
TPP
APP
MPP
TVP
AVP
MVP
0
0
10
75
20
245
30
435
40
560
so
648
(b) Assume a firm has the following cost function;
TC= 40 + 18Q - 2.7Q 2 + 0.1SQ 3
Calculate the Total Cost (TC), Total Variable Cost (TVC), Average Total Cost (ATC), Average
Variable Cost {AVC), and Marginal Cost {MC) if this firm produces quantities of output that
vary from zero to 5 units. Present your results in a Table.
{10 Marks)
Sub-Total
End!
3
(20 Marks)