Related InterviewSolutions

• Economists say inconsistent things. They say 'as price falls, demand rises but as demand rises, price rises'. Defend or Refute.
• If the price of a substitute (Y) of good X increases, what impact does it have on the equilibrium price and quantity of good X ?
• If the prevailing market price is above the equilibrium price, explain its chain of effects.
• A severe drought results in a drastic fall in the output of cotton. Analyse how it will affect the market price of cotton.
• Explain, in brief, the effect of decrease in demand on equilibrium price and equilibrium quantity, when the supply is perfectly elastic.
• State whether the following statements are true or false. Give reasons for your answer. (i) When equilibrium pirce is greater than market price, there will be excess supply in the market. (ii) X and Y and complementary goods. A fall in the price of Y will result in a rise in price of X.
• Explain the change that will take place in the market for a commodity if the prevailing market price is less than the equilibrium price.
• At a price of Rs.50 per chocolate, the demand is 700 chocolates and the supply is 900 chocolates. What is likely to be its effect on the price of chocolates?
• A firm in perfect competition earns _________ in the long run.A. Normal profitsB. Super normal profitsC. Below normal profitsD. none of these
• Equilibrium price remains the same whenA. increase in demand = increase in supplyB. decrease in demand = decrease in supplyC. increase in demand when supply is perfectly elasticD. all of these