Advertisements
Advertisements
प्रश्न
Explain four circumstances under which the law of demand does not operate.
Many a times the inverse relationship between price and the amount purchased does not hold good. Explain this statement giving reasons.
Explain four exceptions to the law of demand.
Advertisements
उत्तर
The law of demand does not operate under the following circumstances.
- The law of demand does not apply to Giffen goods. A fall in the price of Giffen goods tends to reduce its demand and a rise in its price tends to extend its demand.
- The law of demand does not operate when the consumers think that high priced goods are always superior in quality.
- The law of demand does not apply to prestigious goods like diamond jewellery, costly cars etc. The demand for such goods is taken as status symbol. As their prices go up, people take it more prestigious to buy them.
- The consumers may buy more of a commodity even at higher prices when they fear a shortage of that commodity in near future.
- The law of demand does not apply to the necessities of life also.
APPEARS IN
संबंधित प्रश्न
Symbolically, the functional relationship between Demand and Price can be expressed as ______.
Find the odd word
Assumptions to law of demand -
State with reason whether you agree or disagree with the following statement.
There is an inverse relationship between price and demand.
Increase in demand is caused by
Distinguish between extension and contraction of demand.
Write a statement of the Law of Demand.
State with reason whether you agree or disagree with the following statement :
When price of Giffen goods fall, the demand for it increases.
The following table shows the demand schedule for 3 consumers in a market.
| Price in (Rs) | Consumer 1 Demand in (kgs) | Consumer 2 Demand in (kgs) | Consumer 3 Demand in (kgs) | Market Demand |
| 10 | 1 | 2 | (i) ______ | 6 |
| 8 | 2 | (ii) ______ | 4 | 9 |
| 6 | 3 | 4 | 5 | 12 |
| 5 | 4 | 5 | 6 | (iii) ______ |
Based on the above hypothetical schedule answer the following questions.
- What is the demand of Consumer 3 priced at Rs 10 (i)
- What is the demand of Consumer 2 priced at Rs 8 (ii)
- Calculate the total market demand priced at Rs 4 (iii)
- From the above given table examine the relationship between price and demand.
- Mention any one exception to the law of demand.
If with the rise in price of good Y, demand for good X rises, the two goods are:
When at a price of ₹ 5 per unit of a commodity, A's demand is for 11 units, B's demand is for 14 units and C's demand is for units (assuming that there are only three consumers in the market), the market demand is ______.
If prices of cars rise, many people may put off buying a new car. So the demand for petrol will fall.
If a good is inferior good, then purchases of that good will decrease when ______.
Pick the option which does not belong to the group:
What does the term "ceteris paribus" mean in relation to the Law of Demand?
According to the Law of Demand, what happens when the price of a commodity decreases, assuming no other factors change?
Which formula correctly expresses the factors that determine the demand for a commodity?
Which of the following is NOT an assumption of the Law of Demand ?
