Consumer's Equilibrium and Demand-Demand [CBSE (Central Board of Secondary Education) Class-12 Economics]: Questions 19 - 25 of 62

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Question 19

Appeared in Year: 2011

Describe in Detail Subjective▾

Explain the role of the following in correcting ‘deficit demand’ in an economy: (i) Open market operations. (ii) Bank rate.

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Explanation

(i) Open Market Operations as an Instrument to correct Deficit Demand

Open Market Operations indicate to the buying and selling of securities in general public or to the commercial banks in an open market. Deficit demand and the central bank purchases securities in the open market with purchase of securities and with the additional money the level o…

… (86 more words) …

Question 20

Appeared in Year: 2009

Write in Short Short Answer▾

When is the demand of a commodity said to be inelastic?

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Question 21

Appeared in Year: 2010

Write in Short Short Answer▾

Why is demand for water inelastic?

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Question 22

Appeared in Year: 2012

Write in Short Short Answer▾

What are demand deposits?

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Question 23

Appeared in Year: 2012

Describe in Detail Subjective▾

Explain the concept of “exceeds demand in macroeconomics” also explain the role of ‘open market operation’ in correcting it.

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Explanation

Excess demand occur if aggregate demand for output is full employment level of output.

If > Excess demand indicate aggregate demand for output which is more than full employment of output. Excess aggregate demand is the deference between aggregate demand and full employment level of deman…

… (107 more words, 8 figures) …

Question 24

Appeared in Year: 2012

Describe in Detail Subjective▾

Explain the concept of ‘deficient demand’ in macroeconomics. Also explain the role of Bank rate in correcting it.

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Explanation

In deficient demand equilibrium level of demand for output is less than full employment level of output.

If <

It means deficit demand include when aggregate demand of output is less than full employment of demand. Deflationary gap measure amount of deficiency in aggregate demand.

It represe…

… (92 more words, 1 figure) …

Question 25

Appeared in Year: 2012

Describe in Detail Subjective▾

A consumer buys 20 units of good at a price of ₹ 5 per unit. He incurs an expenditure of ₹ 120 when he buys 24 units. Calculate price elasticity of demand using the percentage method. Comment upon the likely shape of demand curve based on this information.

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Explanation

Table of Price Elasticity of Demand
Price (P)Quantity (Q)Total Expenditure
520120
524120

So, Total expenditure = Price Quantity

120 = Price 24

Price = = 5

Elasticity of demand =

… (52 more equations) …