Class 12 Micro Economics - Chapter Market Equilibrium NCERT Solutions | How are the equilibrium price and quanti

How will a change in the price of coffee affect the equilibrium price of tea? Explain the effect on equilibrium quantity also through a diagram. 

When do we say that there is an excess demand for a commodity in the market?

Suppose the price at which the equilibrium is attained in exercise 5 is above the minimum average cost of the firms constituting the market. Now if we allow for free entry and exit of firms, how will the market price adjust to it?

Suppose the market determined rent for apartments is too high for common people to afford. If the government comes forward to help those seeking apartments on rent by imposing control on rent, what impact will it have on the market for apartments?

When do we say that there is an excess supply for a commodity in the market?

Explain through a diagram the effect of a rightward shift of both the demand and supply curves on equilibrium price and quantity.

How are equilibrium price and quantity affected when income of the consumers

a) Increase

b) Decrease

Explain market equilibrium.

Explain how price is determined in a perfectly competitive market with a fixed number of firms.

In what respect do the supply and demand curves in the labor market differ from those in the goods market?

Explain the concept of a production function

What would be the shape of the demand curve so that the total revenue curve is?

(a) A positively sloped straight line passing through the origin?

(b) A horizontal line?

Discuss the central problems of an economy.

What are the characteristics of a perfectly competitive market?

What do you mean by the budget set of a consumer?

What is the total product of input?

From the schedule provided below calculate the total revenue, demand curve and the price elasticity of demand:

What do you mean by the production possibilities of an economy?

How are the total revenue of a firm, market price, and the quantity sold by the firm related to each other?

What is budget line?

Distinguish between microeconomics and macroeconomics.

What do you mean by complements? Give examples of two goods which are complements of each other.

Consider a market with two firms. In the following table, columns labelled as SS₁ and SS₂ give the supply schedules of firm 1 and firm 2 respectively. Compute the market supply schedule.

When does a production function satisfy constant returns to scale?

How does the budget line change if the price of good 2 decreases by a rupee
but the price of good 1 and the consumer’s income remain unchanged?

How does the imposition of a unit tax affect the supply curve of a firm?

Find out the maximum possible output for a firm with zero units of L and 10 units of K when its production function is Q = 5L = 2K. 

What do you mean by a normal good?

Briefly explain the concept of the cost function. 

Suppose a consumer’s preferences are monotonic. What can you say about her preference ranking over the bundles (10, 10), (10, 9) and (9, 9)?