Worksheet: Non-Competitive Markets | Economics Class 11 - Commerce PDF Download

Fill in the Blanks

Q1: Equilibrium price is the price where market demand is equal to market supply, and it represents the position of no price ________________.

Q2: The free interplay of demand and supply is called the ________________ mechanism.

Q3: Excess demand occurs when the quantity demanded is more than the quantity supplied at the prevailing market ________________.

Q4: If an increase in demand is greater than the increase in supply, the equilibrium price ________________.

Q5: According to Marshall, both ________________ and ________________ are equally important in the determination of price.

Q6: In case of a very short period, the demand has more influence on the determination of price for ________________ goods.

Q7: In case of a long period, the supply has more influence in the determination of price for ________________ goods.

Q8: An industry is said to be viable when there is demand in the market at a minimum price that sellers can ________________.

Q9: Price controls with distribution controls often involve ________________ to ensure fair distribution of controlled goods.

Q10: Price ceilings lead to ________________, while price floors lead to ________________.

Assertion and Reason Based

Q1: Assertion: Equilibrium price represents a state of balance in the market.
Reason: At equilibrium, the quantity demanded is equal to the quantity supplied.
(a) Assertion and Reason both are true, and Reason is the correct explanation of the Assertion.
(b) Assertion and Reason both are true, but Reason is not the correct explanation of the Assertion.
(c) Assertion is true, but Reason is false.
(d) Both Assertion and Reason are false.

Q2: Assertion: Price controls, like price ceilings, lead to shortages in the market.
Reason: Price ceilings set a maximum price below the equilibrium market price.
(a) Assertion and Reason both are true, and Reason is the correct explanation of the Assertion.
(b) Assertion and Reason both are true, but Reason is not the correct explanation of the Assertion.
(c) Assertion is true, but Reason is false.
(d) Both Assertion and Reason are false.

Q3: Assertion: In the case of simultaneous increases in demand and supply, the equilibrium price will always rise.
Reason: When demand increases more than supply, prices tend to increase.
(a) Assertion and Reason both are true, and Reason is the correct explanation of the Assertion.
(b) Assertion and Reason both are true, but Reason is not the correct explanation of the Assertion.
(c) Assertion is true, but Reason is false.
(d) Both Assertion and Reason are false.

Q4: Assertion: Excess supply leads to stock accumulation or stockpiling.
Reason: When the quantity supplied is more than the quantity demanded, sellers accumulate excess stock.
(a) Assertion and Reason both are true, and Reason is the correct explanation of the Assertion.
(b) Assertion and Reason both are true, but Reason is not the correct explanation of the Assertion.
(c) Assertion is true, but Reason is false.
(d) Both Assertion and Reason are false.

Q5: Assertion: Minimum wage legislation benefits laborers.
Reason: Minimum wage legislation sets a higher wage limit that employers must pay.
(a) Assertion and Reason both are true, and Reason is the correct explanation of the Assertion.
(b) Assertion and Reason both are true, but Reason is not the correct explanation of the Assertion.
(c) Assertion is true, but Reason is false.
(d) Both Assertion and Reason are false.

Very Short Answer Type Questions

Q1: What is the term for a price where market demand is equal to market supply?

Q2: Define the price mechanism or market mechanism.

Q3: What is excess demand, and what causes it?

Q4: In Case A, when there is a situation of excess demand, what happens to the market price, and why?

Q5: In Case B, when there is a situation of excess supply, what happens to the market price, and why?

Q6: In the numerical solution provided, what is the equilibrium price and quantity when Qd = Qs?

Q7: Explain why both demand and supply are equally important in price determination according to Marshall.

Q8: In which situations does demand have more influence on price determination, according to Marshall?

Q9: In which situations does supply have more influence on price determination, according to Marshall?

Q10: What is the impact of buffer stocks in maintaining support prices in agriculture?

Short Answer Type Questions

Q1: Explain the adjustment mechanism in Case A, where there is excess demand. Provide a step-by-step explanation of how the price changes.

Q2: Describe the adjustment mechanism in Case B, where there is excess supply. Explain the process of price change.

Q3: In the exceptional cases provided, how does the demand change when supply is perfectly elastic? Provide an example.

Q4: In the exceptional cases provided, how does the demand change when supply is perfectly inelastic? Provide an example.

Q5: Describe the outcomes when there is a simultaneous increase in demand and supply. Provide details on the price and quantity changes.

Q6: Explain the outcomes when there is a simultaneous decrease in demand and supply. Discuss the effects on price and quantity.

Q7: What happens when demand increases, but supply decreases? How does this affect the equilibrium price?

Q8: What happens when demand decreases, but supply increases? How does this affect the equilibrium price?

Long Answer Type Questions

Q1: Discuss the concept of price control with a focus on price ceilings and their impact on the market. Explain the consequences of price ceilings, including shortage, rationing, and black marketing.

Q2: Explain the concept of price support with a focus on price floors and their impact on the market. Describe the consequences of price support, including surpluses, buffer stocks, and subsidies.

Q3: Provide examples of cases where there was an imbalance between demand and supply, leading to market disruptions. Discuss the 'onion crisis' and the issues faced by sugarcane farmers in 1978.

Q4: Explore the role of government intervention in markets and its necessity when market forces fail to restore equilibrium. Discuss how government agencies and authorities play a part in resolving market imbalances.