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.
Mention the circumstances under which the law of demand does not operate.
Advertisements
उत्तर
The law of demand does not operate under the following circumstances.
- The law of demand does not apply to Giffen goods. A decrease in the price of Giffen goods tends to lower demand, whereas an increase in the price tends to expand demand.
- When consumers think that high-priced goods are invariably of higher quality, the law of demand fails.
- The law of demand does not apply to prestigious commodities such as diamond jewels and costly cars. The demand for such things is viewed as a status symbol. As their prices rise, purchasing them becomes more prestigious.
- Consumers may buy more of a commodity, even at higher prices, if they anticipate a shortage of that commodity in the near future.
- The law of demand does not apply to the necessities of life also.
APPEARS IN
संबंधित प्रश्न
Briefly explain any two reasons for the occurrence of the law of demand.
Symbolically, the functional relationship between Demand and Price can be expressed as ______.
The Law of Demand was introduced by ______.
Increase in demand is caused by
In case of relatively more elastic demand, the shape of the curve is
Distinguish between extension and contraction of demand.
Explain the law 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.
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 8 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 ______.
State the law of demand.
What is meant by the income effect of a fall in the prices of a commodity?
The following table shows the amount of sugar bought by a household at different prices:
| Period | Price (₹ per kg) | Amount Bought (kg) |
| Jan. 2000 | ₹ 15 | 4 |
| Feb. 2000 | ₹ 16 | 5 |
Does the behaviour of household contradict the law of demand? Give reasons in support of your answer.
What does the term "ceteris paribus" mean in relation to the Law of Demand?
Which formula correctly expresses the factors that determine the demand for a commodity?
Why does the demand curve always slope downwards?
