Under what condition increase in demand would not make any effect on equilibrium price?

3

(a)

Under what condition increase in demand would not make any effect on equilibrium quantity?

3

(a)

Give reasons for the following statements:
(i) A decrease in supply will not result in a change in equilibrium quantity if the demand for a commodity is perfectly inelastic
(ii)  An decrease in supply will not result in a change in equilibrium price if the demand for a commodity is perfectly elastic.

3

(a)

Explain the effects of a 'price ceiling'.

3

(a)

Explain the effects of a 'price floor'.

3

(a)

What would be an effect on equilibrium price and equilibrium quantity if demand and supply both fall at the same rate?

3

(a)

Mention the various cases in which equilibrium price remains same.

3

(a)

Mrs Ramgopal says that economists say inconsistent things: as price falls, demand rises but as demand rises, prices rises. Defend or refute. 

3

(a)

"An increase in the demand for notebooks raises the quantity of notebooks demanded, but not the quantity supplied." Is this statement true or false? Explain.

3

(a)

Given below are four statements. Indicate for each whether it reflects an increase or decrease in demand; quantity demanded; supply; quantity supplied.
(i) Air Deccan reduces its average plane fare by 30% in order to attract more passengers.
(ii) The government grants export subsidy to producers of oranges in Nagpur to increase the sale of oranges abroad.
(iii) Wheat farmers decide to withhold wheat as the market price is low.
(iv) OPEC decides to increase the international oil price

3

(a)

Explain 'black marketing' as a direct consequence of price ceiling.

3

(a)

Explain the concept of 'buffer stock' as a tool of price floor

3

(a)

Explain the effects of 'maximum price ceiling' on the market of a good. Use diagram.

3

(a)

What are the effects of 'price-floor' (minimum price ceiling) on the market of a good? Use diagram.

3

(a)

Market for a good is in equilibrium. There is simultaneous "decrease" both in demand and supply but there is no change in market price. Explain with the help of a schedule how is it possible.

3

(a)