Market Equilibrium and Effects of Shifts in Demand and Supply
Economics ⇒ Consumer and Producer Behaviour
Market Equilibrium and Effects of Shifts in Demand and Supply starts at 11 and continues till grade 12.
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See sample questions for grade 11
Define 'excess demand' and explain its effect on price.
Define price floor.
Describe the process by which a market moves towards equilibrium when there is excess supply.
Explain the concept of 'market-clearing price'.
If the market for wheat is in equilibrium and there is a sudden drought, what is likely to happen to the equilibrium price and quantity?
Suppose the demand for a product increases from 100 units to 150 units at the same price, while supply remains at 100 units. What is the result in the market?
Suppose the equilibrium price of rice is Rs. 40 per kg and the government sets a price floor at Rs. 50 per kg. What will be the likely result?
Suppose the government fixes the price of sugar below the equilibrium price. What is the likely result in the market? (1) Surplus (2) Shortage (3) Equilibrium (4) No effect
If both demand and supply decrease, what happens to the equilibrium quantity? (1) It increases (2) It decreases (3) It remains the same (4) It becomes zero
If the demand curve shifts to the left, what happens to the equilibrium price and quantity? (1) Both increase (2) Both decrease (3) Price increases, quantity decreases (4) Price decreases, quantity increases
If the demand for a good increases while supply remains constant, what happens to the equilibrium price? (1) It increases (2) It decreases (3) It remains the same (4) It becomes zero
If the demand for a good is perfectly inelastic, what happens to equilibrium quantity when supply increases? (1) It increases (2) It decreases (3) It remains the same (4) It becomes zero
A decrease in supply, with demand remaining unchanged, will lead to a ________ in equilibrium price.
At equilibrium price, there is ________ between quantity demanded and quantity supplied.
The equilibrium price is also known as the ________ price.
The equilibrium price is determined by the interaction of ________ and ________.
True or False: A decrease in demand and an increase in supply will both lead to a fall in equilibrium price.
True or False: A rightward shift in the supply curve, with demand constant, will lower the equilibrium price.
True or False: A surplus occurs when quantity supplied is greater than quantity demanded at a given price.
True or False: At equilibrium, there is no tendency for price to change.
