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प्रश्न
Explain four circumstances under which the law of demand does not operate.
Many a times the inverse relationship between price and the amount purchased does not hold good. Explain this statement giving reasons.
Explain four exceptions to the law of demand.
उत्तर
The law of demand does not operate under the following circumstances.
- The law of demand does not apply to Giffen goods. A fall in the price of Giffen goods tends to reduce its demand and a rise in its price tends to extend its demand.
- The law of demand does not operate when the consumers think that high priced goods are always superior in quality.
- The law of demand does not apply to prestigious goods like diamond jewellery, costly cars etc. The demand for such goods is taken as status symbol. As their prices go up, people take it more prestigious to buy them.
- The consumers may buy more of a commodity even at higher prices when they fear a shortage of that commodity in near future.
- The law of demand does not apply to the necessities of life also.
APPEARS IN
संबंधित प्रश्न
Find the odd word
Assumptions to law of demand -
The Law of Demand was introduced by ______.
State with reason whether you agree or disagree with the following statement.
There is an inverse relationship between price and demand.
Increase in demand is caused by
The movement on or along the given demand curve is known as ______
In case of relatively more elastic demand, the shape of the curve is
Distinguish between extension and contraction of demand.
Write a statement of the Law of Demand.
State and explain the law of demand with the help of a hypothetical schedule and graph.
The following table shows the demand schedule for 3 consumers in a market.
| Price in (Rs) | Consumer 1 Demand in (kgs) | Consumer 2 Demand in (kgs) | Consumer 3 Demand in (kgs) | Market Demand |
| 10 | 1 | 2 | (i) ______ | 6 |
| 8 | 2 | (ii) ______ | 4 | 9 |
| 6 | 3 | 4 | 5 | 12 |
| 5 | 4 | 5 | 6 | (iii) ______ |
Based on the above hypothetical schedule answer the following questions.
- What is the demand of Consumer 3 priced at Rs 10 (i)
- What is the demand of Consumer 2 priced at Rs 8 (ii)
- Calculate the total market demand priced at Rs 4 (iii)
- From the above given table examine the relationship between price and demand.
- Mention any one exception to the law of demand.
Any statement about demand for a good is considered complete only when the following is/are mentioned in it:
Pick the option which does not belong to the group:
What is meant by the income effect of a fall in the prices of a commodity?
Identify the correct statement from the following alternatives:
State whether the following statement is true or false. Give reasons.
The law of demand states a direct relationship between price and demand.
