Advertisements
Advertisements
Question
The following table shows a change in the demand. Read the table carefully and answer the question that follows:
| Case I | Case II | ||
| Price (₹) | Quantity | Price (₹) | Quantity |
| 10 | 20 | 10 | 20 |
| 10 | 10 | 5 | 20 |
What type of change is it, decrease in demand or contraction in demand? Give a reason.
Advertisements
Solution
It is a situation of decrease in demand in both cases.
Reason: The consumer buys a smaller quantity at the same price (Case I) or buys the same quantity at a lower price (Case II).
APPEARS IN
RELATED QUESTIONS
What is meant by the contraction in demand?
As a result of rise in consumer's income, the demand curve for coarse-grain (inferior good) will:
What does a downward movement along the same demand curve indicate?
What does an upward movement along the same demand curve indicate?
When the demand curve of a product shifts to the right, it represents a situation of ______.
Give two reasons for the shift of the demand curve towards the left.
In order to encourage tourism in Goa, Government of India suggests Indian Airlines to reduce air fares to Goa from four major cities: Chennai, Kolkata, Mumbai and New Delhi. If the Indian Airlines reduces the air fare to Goa, how will this affect the market demand curve for air travel to Goa?
With the help of a suitable diagram, distinguish between a change in quantity demanded and a change in demand.
Distinguish between “movement along the demand curve” and shift of a demand curve.
State whether the following statement is true or false. Give reasons.
A change in quantity demanded as a result of price change will imply a shift of the demand curve to the right.
