Impact of Demand and Supply Shifts on Equilibrium

Q.

Which of the Following Is a Variable Cost?

1. Salary of permanent staff

2. licence fees

3. rent of premises

4. wages

Q.

While subsidies encourage farmers to use new technology, they are a huge burden on government finances. Discuss the usefulness of subsidies in the light of this fact.

Q.

Match the following:

1.	Prime Minister	A.	Seeds that give large proportion of output
2.	Gross Domestic Product	B.	Quantity of goods that can be imported
3.	Quota	C.	Chairperson of the planning commission
4.	Land Reforms	D.	The money value of all the final goods and services produced within the economy in one year
5.	HYV Seeds	E.	Improvements in the field of agriculture to increase its productivity
6.	Subsidy	F.	The monetary assistance given by government for production activities.

Q.

‘Information technology plays a very significant role in achieving sustainable development and food security’ — comment.

Q.

What is marketable surplus?

Q.

What are some factors that may impact or change market equilibrium?

Q. Answer the following questions.

What are the positive and negative effects of LPG (Liberalisation, Privatisation and Globalisation) on agriculture?

Q. How will an increase in the income of the buyer of an inferior good affect its equilibrium price and equilibrium quantity? Explain with the help of a diagram.

Q. Write explanatory notes.

1. Failure of the Tenth Five-Year Plan.

2. Explain the achievements of the Tenth Five-Year Plan.

Q. Market demand is a total demand of __________ buyers.

1. some
2. all
3. one
4. two

Q. Explain how equilibrium level of income can be determined with the help of aggregate demand curve and aggregate supply curve.

Q. The maximum price the consumer is willing to pay for a commodity to maximise satisfaction is equal to __________.

1. total utility
2. marginal rate of substitution
3. marginal utility
4. average utility

Q.

1. True
2. False

Q. Which of the following is not a central problem of a society?

1. When to produce
2. What to produce
3. How to produce
4. For whom to produce

Q. If two goods are Complements, it means that a rise in the price of one commodity will lead to -

1. Upward Shift in demand for the other commodity
2. Rise in the price of the other commodity
3. Downward Shift in demand for the other commodity
4. No shift in the demand for the other commodity

Q. The table given below shows the demand and supply position of Pizza's at various prices.

Price	Daily demand	Daily supply
25	3000	2300
27	2950	2350
30	2750	2475
32	2650	2650
33	2600	2750

What is the equilibrium price?

1. Rs. 30
2. Rs. 32
3. Rs. 33
4. Rs. 32.5

Q. Give reasons for the following:

1. Privatisation was encouraged in the New Economic Policy.

2. Under the New Economic Policy, inflow of foreign capital was encouraged.

3. Indian farmers are shifting cultivation from food grains to non-food grains.

Q. How many indifference curves can touch the price line?

1. Two
2. One
3. As many as possible
4. None of the above

Q. A rise in supply of a commodity leads to a __________.

1. increases the price of that commodity
2. decreases the price of that commodity
3. neutralizes the changes in the price
4. determines the price elasticity

Q. If graphical presentation is made for demand and supply curve equilibrium is attained when __________.

1. demand curve is parallel to X-axis
2. demand curve intersects supply curve
3. supply curve is parallel to Y-axis
4. demand curve is parallel to supply curve

Q. Differentiate between contraction of demand and decrease in demand, using diagrams.

Q.

give 2 examples where technological progress leads to shift in supply curve.

Q. If the consumer consumes only one commodity 'X', he will be in equilibrium when _________.
[Here, $M{U}_X=$ Marginal utility of the Good $-X$ (in terms of money); $P_X=$ Price of Good $-X$.]

1. $M{U}_X<P_X$
2. $M{U}_X=P_X$
3. $M{U}_X>P_X$
4. none of these

Q. Distinguish between:
Partial equilibrium and General equilibrium.

Q. State true or false with reason: Intermediate good remain within the production boundary.

1. True
2. False

Q. With increasing returns to scale, the equilibrium in a market is incomplete. This is __________.

1. none of the above
2. only in the case of imperfectly competitive market
3. only in the case of perfectly competitive market
4. only in the case of monopolistic market situations

Q. If IC is not convex at the point of equilibrium, the consumer cannot reach the point of stable equilibrium. Comment.

Q. What are the contributions of industrialization to development?

Q. Other things being equal, as Demand increases, Equilibrium Price -

1. decreases
2. increases
3. does not change at all
4. cannot be commented upon.

Q. Explain the concept of Maximum Price Legislation with the help of a diagram.