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Chapters
1: Microeconomics and Macroeconomics: Introduction
2: Demand and Law of Demand
3: Theory of Consumer Behaviour: Marginal Utility and Indifference Curve Analysis
4: Elasticity of Demand
▶ 5: Supply - Law of Supply and Price Elasticity of Supply
6: Market Mechanism: Equilibrium Price and Quantity in a Competitive Market
7: Laws of Returns - Returns to a Factor and Returns to Scale
8: Cost and Revenue Analysis
9: Forms of Market
10: Producer's Equilibrium
11: Determination of Equilibrium Price and Output Under Perfect Competition
SECTION 2: THEORY OF INCOME AND EMPLOYMENT
12: Theory of Income and Employment
SECTION 3: MONEY AND BANKING
13: Money: Meaning and Functions
14: Banks: Commercial Bank and Central Bank
SECTION 4: BALANCE OF PAYMENTS AND EXCHANGE RATE
15: Balance of Payments and Exchange Rate
SECTION 5: PUBLIC FINANCE
16: Fiscal Policy
17: Government Budget
SECTION 6: NATIONAL INCOME
18: National Income and Circular Flow of Income
19: National Income Aggregates
20: Methods of Measuring National Income
SECTION 7: PROJECT WORK
21: Project Work
22: Model Short Answer Questions
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Solutions for Chapter 5: Supply - Law of Supply and Price Elasticity of Supply
Below listed, you can find solutions for Chapter 5 of CISCE Frank for Economics [English] Class 12 ISC.
Frank solutions for Economics [English] Class 12 ISC 5 Supply - Law of Supply and Price Elasticity of Supply TEST YOURSELF QUESTIONS [Pages 100 - 105]
Select the correct option for each of the following questions: (1 mark each)
Various quantities of a commodity which producers are willing to produce and offer for sale at different prices during a particular period is called ______.
quantity supplied
individual supply
supply
none of these
Stock of a commodity refers to ______.
the quantity available with the consumer
quantity available with the seller at any given time
both (a) and (b)
neither (a) nor (b)
What type of relationship between the price of a commodity and the quantity supplied is indicated by the law of supply?
Positive
Inverse
Constant relationship
None of these
________ states that, other things being equal, quantity supplied of a commodity increases with increase in its price. Mark the right option from the given options below:
Law of variable proportion
Cost function
Law of supply
Law of returns to scale
Graphical representation of various quantities of a commodity which all the producers are willing to produce and sell at different prices during a given period is known as ______.
individual supply curve
market supply curve
demand curve of the firms
buyers’ demand curve
What is the reason for upward sloping supply curve?
Direct relation between price and quantity
Change in the number of producers
Profit maximisation
All the above
Which of the given options is the correct reason for backward sloping curve of labour?
Labour first prefers work over leisure and then leisure over work
Labour first prefers leisure over work and then work over leisure
Both Labour first prefers work over leisure and then leisure over work and Labour first prefers leisure over work and then work over leisure
Neither Labour first prefers work over leisure and then leisure over work nor Labour first prefers leisure over work and then work over leisure.
Contraction of supply refers to a situation when there is ______.
fall in the own price of a commodity
fall in the quantity supplied at the lower price of the commodity
downward movement along the same supply curve
all of the above
When supply increases due to improvement in technology it is known as ______.
extension in supply
increase in supply
contraction of supply
decrease in supply
An increase in the prices of factors of production leads to ______.
rightward shift to the supply curve
expansion in supply
leftward shift in supply curve
contraction in supply
The supply curve of good shifts to the right when the price of other goods ______.
Remains constant
Rise
Fall
None of the above
If the price of a commodity X increases by 60 per cent, but the quantity supplied increases by only 50 per cent, the supply of this commodity will be ______.
highly elastic
elastic
perfectly elastic
inelastic
A vertical supply curve parallel to Y-axis is ______.
perfectly elastic
perfectly inelastic
unitary elastic
inelastic
Elasticity of supply is always positive because of ______.
direct relationship between price and supply
inverse relation between price and supply
Both direct relationship between price and supply and inverse relationship between price and supply
Neither direct relationship between price and supply and inverse relationship between price and supply
Supply of a commodity would be relatively more elastic in case of ______.
short period
long period
very short period
none of these
A straight line supply curve drawn through the origin has the same type of elasticity at all the points ______.
es = 1
es < 1
es > 0
es > 1
A straight line supply curve that cuts the X-axis has ______.
inelastic supply
unitary elastic supply
elastic supply
perfectly elastic supply
Which one of the following is not a ceteris paribus assumption of the Law of Supply?
Indirect taxes and subsidies on the firm's products remain constant
Technology used by the firm in production remains constant
Prices of the factors of production paid by the firm remain constant
Price of the commodity produced by the firm remains constant
From the following statements given in Column I and Column II, choose the correct pair of statements.
| Column I | Column II |
| (A) Stock | 1. Upward movement on the supply curve |
| (B) Increase in supply | 2. Total quantity available at a particular point of time |
| (C) Expansion in supply | 3. States direct relationship between price and quantity supplied |
| (D) Law of supply | 4. Supply rises at the same price |
A - 2, B - 4, C - 3, D - 1
A - 1, B - 2, C - 4, D - 3
A - 2, B - 4, C - 1, D - 3
A - 4, B - 2, C - 3, D - 1
Given below are two statements marked as Assertion(A) and Reason (R). Read the statements carefully and choose the correct option.
Assertion (A): Price elasticity of supply is less than one in the case of inelastic supply.
Reason (R): Percentage change in price is less than the percentage change in the quantity supplied.
Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).
Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).
Assertion (A) is true, but Reason (R) is false.
Assertion (A) is false, but Reason (R) is true.
Very Short Answer Questions (2 marks each)
Define supply.
Distinguish between supply and stock.
OR
Give two differences between intended supply and actual supply.
Distinguish between Individual supply and Market supply.
Explain how the supply of a commodity is affected by the prices of other related commodities. Give suitable examples.
How do changes in the prices of factors of production affect the supply of a commodity?
How do expectations about future prices affect the supply of a commodity?
How will cost-saving technical progress affect the supply curve?
Explain four factors on which the supply of a commodity depends.
Mention two factors other than price, which influence the supply of a commodity.
What is supply function?
State the law of supply.
What is a supply schedule?
What is a supply curve?
Explain the shape of a supply curve.
State and explain the law of supply with the help of a diagram.
What is meant by market period?
What is meant by market period?
What is the shape of supply curve in the market period?
Draw the supply curve of a perishable commodity. Give a reason for the shape of the supply curve.
What is the implication of a vertical supply curve?
Define ‘shift’ in supply curve.
OR
What is meant by a change in supply?
State what causes movement along the supply curve and show it diagrammatically.
OR
What is meant by change in quantity supplied?
What is meant by ‘increase’ in supply?
What is ‘decrease’ in supply?
What is expansion of supply?
Define contraction in supply.
What causes a downward movement along a supply curve?
What does the shift of supply curve to the right indicate?
What effect does an increase in excise tax rate have on the supply curve of the product?
How does an improvement in production technology influence the supply curve of a firm?
What effect does an increase in production subsidy have on the supply curve?
Define price elasticity of supply.
State the degrees of elasticity of supply.
Write the formula of measuring price elasticity of supply.
What is meant by perfectly elastic supply?
What do you mean by perfectly inelastic supply?
What do you mean by elastic supply?
What is meant by the Unitary elastic supply?
Draw the supply curve showing price elasticity of supply equal to one.
Draw the supply curve showing price elasticity of supply less than one.
Draw a straight line supply showing elasticity greater than one.
Draw a supply curve for elasticity of supply = 0.
Draw a supply curve for elasticity of supply = ∞.
Draw a supply curve for Elasticity of supply < 1.
The price of chocolates increased during the Valentine week in February leading to an increase in the supply at a greater rate.
Identify the price elasticity of supply and illustrate it on a diagram.
Explain any four determinants of elasticity of supply.
Short Answer Questions (3 marks each)
Explain the supply function.
State the law of supply.
Discuss how change in technology affects the supply of a commodity.
Why does supply curve slope upward to the right?
Derive a market supply curve from two hypothetical individual supply schedule.
State and explain the law of supply with exceptions.
Why is the supply curve of labour backward sloping? Explain with the help of a diagram.
OR
Discuss how the supply of labour is an exception to the law of supply. Justify the statement using a diagram.
State what causes movement along the supply curve and show it diagrammatically.
Define increase in supply.
Distinguish between expansion of supply and increase in supply.
Distinguish between contraction and decrease in supply.
Distinguish between a change in quantity supplied and a change in supply.
State three factors that can cause a rightward shift of the supply curve of a commodity.
OR
Give one reason for an “increase” in supply of a commodity.
Explain three determinants of a leftward shift of the supply curve.
What is meant by price elasticity of supply?
How is elasticity of supply measured according to the percentage method?
Define price elasticity of supply.
Draw the supply curve of the following situation:
Elasticity of supply = 0
Draw supply curve of the following situation:
Elasticity of supply = ∞
Long Answer Questions
Distinguish between supply and stock.
With the help of diagrams, explain the relationship between time period and supply.
Explain four factors on which the supply of a commodity depends.
State and explain the law of supply with the help of a diagram.
Explain the law of supply with the help of a supply schedule and supply curve.
State and explain the law of supply with its assumptions.
State and explain the law of supply with exceptions.
Derive a market supply curve from two hypothetical individual supply schedule.
Distinguish between a change in quantity supplied and a change in supply.
State three factors that can cause a rightward shift of the supply curve of a commodity.
State and explain the elasticity of supply when a straight line supply curve cuts the Y-axis.
State and explain the elasticity of supply when a straight-line supply curve cuts the X-axis.
State and explain the elasticity of supply when a straight line supply curve passes through the origin O.
State and explain the elasticity of supply when a straight line supply curve is parallel to the X-axis.
State and explain the elasticity of supply when a straight line supply curve is parallel to the Y-axis.
Define price elasticity of supply.
Draw the supply curve showing price elasticity of supply equal to one.
Draw a straight line supply showing elasticity greater than one.
Explain the geometric method of calculating the elasticity of supply.
How can you determine the elasticity of supply at any point on a non-linear supply curve? Explain with the help of a diagram.
Explain any four determinants of elasticity of supply.
Thinking Beyond...
In the text, you have learnt that a positively sloping straight line supply curve has the same supply elasticity at all the points. Can we say the same thing about the supply elasticity at different points on the positively sloping non-linear supply curve?
Frank solutions for Economics [English] Class 12 ISC 5 Supply - Law of Supply and Price Elasticity of Supply NUMERICAL QUESTIONS [Page 105]
A seller sells 100 units of a commodity when its price per unit is ₹ 10. The supply goes up to 140 units as a result of an increase in its price to ₹ 12 per unit. Calculate the price elasticity of supply.
As a result of fall in the price of a commodity from ₹ 6 per unit to ₹ 5 per unit, the quantity supplied falls by 25 percent. Calculate its price elasticity of supply.
When the price of a commodity rises from ₹ 10 to ₹ 11 per unit, its quantity supplied rises by 100 units. Its price elasticity of supply is 2. Calculate the quantity supplied at the increased price.
The quantity supplied of a commodity at a price ₹ 10 per unit is 1250. Its price elasticity is 1. Calculate the price at which its quantity supplied will be 750.
Solutions for 5: Supply - Law of Supply and Price Elasticity of Supply
Frank solutions for Economics [English] Class 12 ISC chapter 5 - Supply - Law of Supply and Price Elasticity of Supply
Shaalaa.com has the CISCE Mathematics Economics [English] Class 12 ISC CISCE solutions in a manner that help students grasp basic concepts better and faster. The detailed, step-by-step solutions will help you understand the concepts better and clarify any confusion. Frank solutions for Mathematics Economics [English] Class 12 ISC CISCE 5 (Supply - Law of Supply and Price Elasticity of Supply) include all questions with answers and detailed explanations. This will clear students' doubts about questions and improve their application skills while preparing for board exams.
Further, we at Shaalaa.com provide such solutions so students can prepare for written exams. Frank textbook solutions can be a core help for self-study and provide excellent self-help guidance for students.
Concepts covered in Economics [English] Class 12 ISC chapter 5 Supply - Law of Supply and Price Elasticity of Supply are Determinants of Supply, Concept of Supply, Shift of the Supply Curve or Change in Supply, Distinction Between Supply and Stock, Supply Schedule, Exceptions to the Law of Supply, Measurement of Elasticity of Supply > Geometric or Point Method, Determinants of Elasticity of Supply, Law of Supply, Movement Along the Supply Curve Or Expansion and Contraction of Supply, Elasticity of Supply, Price Elasticity of Supply, Categories (Degrees) of Elasticity of Supply, Measurement of Elasticity of Supply > Percentage Method, Time Period and Supply, Contraction of Supply and Decrease in Supply, Expansion of Supply and Increase in Supply, Individual and Market Supply, Supply Function, Supply Curve, Derivation of Market Supply Curve From Individual Supply Curves, Explanation of the Law of Supply, Meaning and Types of Elasticity of Demand, Importance of Elasticity of Supply.
Using Frank Economics [English] Class 12 ISC solutions Supply - Law of Supply and Price Elasticity of Supply exercise by students is an easy way to prepare for the exams, as they involve solutions arranged chapter-wise and also page-wise. The questions involved in Frank Solutions are essential questions that can be asked in the final exam. Maximum CISCE Economics [English] Class 12 ISC students prefer Frank Textbook Solutions to score more in exams.
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