CBSE Class-12 Economics: Questions 434 - 438 of 523

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Question number: 434

» Market and Price Determination » Market Equilibrium

Essay Question▾

Describe in Detail

Define equilibrium price. How is it determined? Explain with the help of a schedule.

Explanation

The price equal to the market demand of a commodity with its market supply is the equilibrium price. Equilibrium price is determined at a point where market demand is equal to market supply.

Demand and supply schedules are given: -

Determination of Equilibrium Price

Price

( Rs. )

Quantity Demanded… (85 more words) …

Question number: 435

» Consumer's Equilibrium and Demand » Demand » Demand Schedule

Essay Question▾

Describe in Detail

In an economy, aggregate demand is less than aggregate supply. Is the economy in equilibrium? If not, explain the changes that will bring the economy in equilibrium.

Explanation

If aggregate demand (AD) is less than aggregate supply (AS) then economy is not in equilibrium because an economy is in equilibrium when AS = AD. When AD < AS, flow of goods and services in the economy exceed their demand. Some of the goods would remain unsold. So, unnecessary… (49 more words) …

Question number: 436

» Balance of Payments » Foreign Exchange Rate

Essay Question▾

Describe in Detail

Explain the meaning and two merits of fixed foreign exchange rate.

Explanation

Fixed exchange rate is rate of foreign exchange it is fixed by authority of country Merits of fixed exchange rate is given below:

(1) Avoid variation in exchange rate and exchange rate is fixed by government so the exchange rate becomes free from variations.

(2) Makes international trade more predictable… (11 more words) …

Question number: 437

» Producer Behaviour and Supply » Cost

Essay Question▾

Describe in Detail

Given below is cost and revenue schedule of a producer. At what level of output is producer in equilibrium? Give reasons for your answer.

Output (Units)

Price ( Rs. )

Total cost ( Rs. )

1

10

13

2

10

22

3

10

30

4

10

38

5

10

47

6

10

57

7

10

71

Explanation

In this cost and revenue schedule of a producer is given

Output (Units)

Price ( Rs. )

Total cost ( Rs. )

Total Revenue

TR = Price × Output

Profit = TR - TC

1

10

13

10

-3

2

10

22

20

-2

3

10

30

30

0

4… (73 more words) …

Question number: 438

» National Income and Related Aggregates » National Disposable Income

Essay Question▾

Describe in Detail

From the following data, calculate “national income” by (I) income method and (ii) expenditure method.

calculate national income

calculate national income by (a) income method and (b) expenditure method:

-

( Rs. In crores)

Net domestic capital formation

360

Interest

200

Rent

300

Private final consumption expenditure

1300

Government final consumption expenditure

730

Net exports

(-) 20

Net indirect taxes

70

Net current transfers from rest of the world

80

Consumption of fixed capital

60

Net factor income to abroad

(-) 50

Profits

600

Compensation of employees

1200

Explanation

(i) income method

National income = Interest + Rent + Profits + Compensation of employees - Net factor income to abroad

= 200 + 300 + 600 + 1200 – (-50)

= Rs. 2350 crore

(ii) Expenditure method:

national income = Government final consumption expenditure + Private final consumption expenditure… (48 more words) …

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