Demand for a commodity refers to:

1

(a)

desire for the commodity.

(b)

need for the commodity.

(c)

quantity demanded of that commodity

(d)

quantity of the commodity demanded at a certain price during any particular period of time.

Contraction of demand is the result of:

1

(a)

decrease in the number of consumers.

(b)

increase in the price of goods concerned

(c)

increase in the prices of other goods

(d)

decrease in the income of purchasers

All but one of the following are assumed to remain the same while drawing an individual's demand curve for a commodity. Which one is it?

1

(a)

The preference of the individual

(b)

His monetary income.

(c)

Price.

(d)

Price of related goods.

Which of the following pairs of goods is an example of substitutes?

1

(a)

Tea and sugar

(b)

Tea and coffee.

(c)

Pen and ink.

(d)

Shirt and trousers

The Law of Demand, assuming other things to remain constant, establishes the relationship between:

1

(a)

income of the consumer and the quantity of goods demanded by him.

(b)

price of goods and the quantity demanded.

(c)

price of goods and the demand for its substitute.

(d)

quantity demanded of goods and the relative prices of its complementary goods.

Law of demand states that price and demand are positively related to each other.

1

(a) True

(b) False

Law of demand happens due to application of law of diminishing marginal productivity.

1

(a) True

(b) False

Law of demand explains quantitative relationship· between price and quantity demanded.

1

(a) True

(b) False

Change in quantity demanded means an increase and decrease in demand and Change in demand curve means expansion and contraction in demand.

1

(a) True

(b) False

With a fall in income, demand for normal goods will rise.

1

(a) True

(b) False

What is meant by demand?

2

(a)

Demand is a quantity of a commodity that a consumer wishes to purchase at a given level of price and during a specified period of time.

Define market demand.

2

(a)

Market demand refers to the quantity of a commodity that all the consumers are willing and able to buy, at a particular price during a given period of time.

Due to rise in price of commodity x the demand of commodity y falls. What type of commodity are they?

2

(a)

Complementary goods.

Due to rise in price of the commodity x, the demand of commodity y also rises. What type of commodity they are?

2

(a)

Substitute goods.

How will an increase in the price of petrol affect the demand curve of a car?

2

(a)

The demand curve of a car will shift to the left.

What do you mean by substitutes? Give examples of two goods which are substitutes of each other.

3

(a)

What do you mean by complements? Give examples of two goods which are complements of each other.

3

(a)

Does a rise in price of other goods have the same effect on demand for a commodity?

3

(a)

What do you mean by an 'inferior good'? Give some examples.

3

(a)

Give the meaning of inferior good and explain the same with the help of an example.

3

(a)

Explain the causes behind law of demand.

5

(a)

Explain with the help of diagrams, the effect of the following changes on the demand of a commodity:
(i) A rise in price of Substitute good.
(ii) A rise in price of Complementary good.

5

(a)

Explain the effect of the following on demand for a good:
(i) Fall in Income for Normal Goods.
(ii) Fall in Income for Inferior Goods.

5

(a)