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Test: Market Equilibrium - 1


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10 Questions MCQ Test Indian Economy for UPSC CSE | Test: Market Equilibrium - 1

Test: Market Equilibrium - 1 for Commerce 2022 is part of Indian Economy for UPSC CSE preparation. The Test: Market Equilibrium - 1 questions and answers have been prepared according to the Commerce exam syllabus.The Test: Market Equilibrium - 1 MCQs are made for Commerce 2022 Exam. Find important definitions, questions, notes, meanings, examples, exercises, MCQs and online tests for Test: Market Equilibrium - 1 below.
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Test: Market Equilibrium - 1 - Question 1

This a MCQ (Multiple Choice Question) based practice test of Chapter 5 - Market Equilibrium of Economics of Class XII (12) for the quick revision/preparation of School Board examinations

Q  _____________ is the price at which demand for a commodity is equal to its supply?

Detailed Solution for Test: Market Equilibrium - 1 - Question 1

At equilibrium price quantity demanded and quantity supplied of a commodity are equal. This quantity is called the equilibrium quantity of the commodity. In practical life, the price at which the seller/firm wants to sell a commodity, its quantity supplied may be greater or lesser than its quantity demanded.

Test: Market Equilibrium - 1 - Question 2

Equilibrium price may or may not change with shifts in both demand and supply curve.

Detailed Solution for Test: Market Equilibrium - 1 - Question 2

Factors that can shift the demand curve for goods and services, causing a different quantity to be demanded at any given price, include changes in tastes, population, income, prices of substitute or complement goods, and expectations about future conditions and prices.

Test: Market Equilibrium - 1 - Question 3

Excess demand is a situation when

Test: Market Equilibrium - 1 - Question 4

Deficient demand is a situation when

Test: Market Equilibrium - 1 - Question 5

During excess demand

Detailed Solution for Test: Market Equilibrium - 1 - Question 5

Excess demand refers to the situation when aggregate demand (AD) is more than the aggregate supply (AS) corresponding to full employment level of output in the economy. It is the excess of anticipated expenditure over the value of full employment output.

Test: Market Equilibrium - 1 - Question 6

Deficient demand

Detailed Solution for Test: Market Equilibrium - 1 - Question 6

Deficient demand refers to the situation when aggregate demand is short of aggregate supply corresponding to full employment level in the economy. Aggregate supply being perfectly elastic, it converges with aggregate demand at a lower level of output lower than the full employment level of output in the economy

Test: Market Equilibrium - 1 - Question 7

During deficient demand

Detailed Solution for Test: Market Equilibrium - 1 - Question 7

Excess Demand. When at the current price level, the quantity demanded is more than quantity supplied, a situation of excess demand is said to arise in the market. Excess demand occurs at a price less than the equilibrium price.

Test: Market Equilibrium - 1 - Question 8

After excess demand

Detailed Solution for Test: Market Equilibrium - 1 - Question 8

In case of excess demand, the demand of a commodity is more than its supply. SO in this case, there will be competition among consumers and every consumer tries to purchase more of a commodity by paying higher prices. This will tend price to rise.

Hence a) Market price rise

Test: Market Equilibrium - 1 - Question 9

Ring deficient demand

Detailed Solution for Test: Market Equilibrium - 1 - Question 9

Deficient demand refers to the situation when aggregate demand (AD) is less than the aggregate supply (AS) corresponding to full employment level of output in the economy. The situation of deficient demand arises when planned aggregate expenditure falls short of aggregate supply at the full employment level.

Test: Market Equilibrium - 1 - Question 10

Excess demand occurs when

Detailed Solution for Test: Market Equilibrium - 1 - Question 10

When at the current price level, the quantity demanded is more than quantity supplied, a situation of excess demand is said to arise in the market. Excess demand occurs at a price less than the equilibrium price.

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