Read the following case carefully and answer the questions that follow: Average cost of solar energy has been decreasing continuously for past decades in the world market. Comparing the cost of…

Read the following case carefully and answer the questions that follow: Average cost of solar energy has been decreasing continuously for past decades in the world market. Comparing the cost of electricity from new power plants in 2009 and 2019, the cost of solar electricity (from photovoltaic module) fell from Rs 44,875 per megawatt hour to Rs 5,000 per megawatt hour. The cost reduction is possible because larger, more efficient factories are producing the modules, technological advances increase the efficiency of the panels, engineering advances improve the production processes of the silicon ingots and wafers; the mining and processing of the raw materials extends in scale and becomes cheaper, operational experience accumulates by 'learning by doing'; the modules are more durable and live longer; market competition ensures that profits are low and capital costs for the production decline. Once solar hit scale, it started having its own supply chain and the module itself got a lot cheaper and with that scale there was more research and development. In 2010, fewer than 50,000 megawatts of solar installed but in 2019 with more than 500,000 megawatts installed. In contrast to this steady decline in renewable energy generation costs, prices of natural gas and coal have sharply increased. The fossil fuel sector is becoming more volatile and riskier. For coal, gas, and nuclear reactors, the cost increases are primarily due to the current cost of fuel fuel, and the plant's operating costs. Renewables like wind and solar don't need to pay for fuel. They need only to build the generating plants. Maintaining the cost. All power plants that rely on nonrenewable sources of energy will have the continued expense, even if the technology to build the plants improves. Solar energy in Nepal is abundant and cheap. the solar potential in Nepal is 50,000 megawatt-hours per year, which is 100 times larger than the hydro resources. The cost of solar electricity in Nepal is NRs 5,000 per megawatt hour. Once the solar industry becomes mature it will be just NRs 2,000 per megawatt hour from now NRs 6,000. In the future, the Nepali people can expect to achieve a much higher living standard. When Nepal catches up with neighbouring countries, each person will consume about 15 megawatt-hours per person per year of electricity, which is 70 times larger than today. Clean solar electricity can be used in lightening the darkness, lighting homes, cooking, cooking food, charging electric vehicles, driving industry, computing, using telecommunications, pumping water, grinding grain and refrigerating. Questions: a. Draw long run average cost curve of solar electricity and nonrenewable sources of energy. b. What types of economies of scale does the solar electricity enjoy during the decades? c. Describe the factors determining the supply of solar energy. d. Describe the factors determining the demand for solar electricity in Nepal.