CHSL GK Questions, Held on 02-02-2017 Shift-2
11. Match the characteristics with their market structur:
(a) Expand out put until MC = MR — Monopolistic competition
(b) Elasticity of demand depends on procing policies of rivals — Oligopoly
12. Panna National park is in which state? — Madhya Pradesh
13. BSE SENSEX constitutes ___ number of companies.— 30
14. International Date line passes through the middle of _____Ocean. — Pacific
15. What is the capital of Turkey? — Ankara
16. Before its Independence, Bangladesh was part of —Pakistan
17. Humayun was born in the year — 1509
18. Who Invented the 3-D printer? — Chuck Hull
19. Alpha particles are — Just like Helium nuclei
20. Unit of impedance is — Ohm
21. Who has served maximum time as the Prime minister of India? — Jawaharlal Nehru
22. What is the maximum number of Members in Lok Sabha? — 552
23. In 2012 London Olympics, Saina Nehwal won the— Bronze Medal
24. Who is the author of “Go Clown: #Acche din for Comedy”? — Shatrugna Vadwlas
25. Periyar Tiger Reserve is in which state? — Kerala
Movement along the same demand curve is known as/ एक ही मांग वक्र के साथ आंदोलन के रूप में जाना जाता है
(1) Extension and Contraction of Demand / मांग का विस्तार और संकुचन
(2) Increase and Decrease of Demand / माँग की वृद्धि और कमी
(3) Contraction of supply / आपूर्ति का संकुचन
(4) Increase of supply / आपूर्ति में वृद्धि
(SSC Section Officer (Audit) Exam. 09.09.2001)
Answer and Explanation : –
(2) Increase and Decrease of Demand / माँग की वृद्धि और कमी
(2) A shift in सप्लाई कर्व में शिफ्ट the demand curve is caused by a factor affecting demand other than a change in price. If any of these factors change then the amount consumers wish to purchase changes whatever the price. The shift in the demand curve is referred to as an increase or decrease in demand. A movement along the demand curve occurs when there is a change in price. This may occur because of a change in supply conditions. The factors affecting demand are assumed to be held constant. A change in price leads to a movement along the demand curve and is referred to as a change in quantity demanded. / मांग वक्र में बदलाव एक कारक के कारण होता है जो कीमत में बदलाव के अलावा मांग को प्रभावित करता है। यदि इनमें से कोई भी कारक बदल जाता है, तो उपभोक्ता जो भी मूल्य चाहे परिवर्तन को खरीदना चाहता है। मांग वक्र में बदलाव को मांग में वृद्धि या कमी के रूप में संदर्भित किया जाता है। मांग में बदलाव के साथ एक आंदोलन तब होता है जब मूल्य में बदलाव होता है। आपूर्ति की स्थिति में बदलाव के कारण ऐसा हो सकता है। मांग को प्रभावित करने वाले कारकों को स्थिर माना जाता है। मूल्य में परिवर्तन से मांग वक्र के साथ एक आंदोलन होता है और इसे मांग की गई मात्रा में परिवर्तन के रूप में संदर्भित किया जाता है।
Theory of Demand
Theory of Demand, tells the relationship between the price of goods and its quantity demanded. If the price of any good or service increases then its demand decreases and vice versa.
Theory of Demand, tells the relationship between the price of goods and its quantity demanded. If the price of any good or service increases then its demand decreases and vice versa. The better you understand the law of demand, the better you will understand why you pay different prices for different goods. Where there is demand there is a supplier and sometimes suppliers can create demand. There are many factors that influence demand for goods and services in the market place.
Theory of Demand: Definition
It defines relationship between the quantitiy of a good consumers will purchase and the price charged for that good. It states that the quantity demanded for a good rises as the price falls, all other things staying the same (no change in the income of the consumer, taste of the consumer and price of other goods). These are other things that can affect demand besides price.
For example, if you really like Apple products, you might not mind paying a higher price for the new phone that just came out. If you get a new job and your income goes up, you might not mind paying higher prices for certain goods because of your new-found wealth.
In simple language, we can say that when the price of a good rises, people buy less of that good. When the price falls, people buy more of it. Economists believe strongly in the law of demand because it is so believable for those who don't study economics.
Figure of Demand Curve is सप्लाई कर्व में शिफ्ट given below:
Types of Demand
The various types of demandsare in general discussed below:
- Negative Demand – Negative demand is a type of demand which is created if the product is disliked in general. The marketer has to solve the issue of no demand by analyzing why the market dislikes the product and then counter acting with the right marketing tactics.
- No demands – Certain products face the challenge of no demand.
- Declining demand – Declining demand is when demand for a product is declining.
- Irregular demand – These products sell irregularly and sell more during peak season whereas their demand is very low during non-seasons.
- Full demand – It also means that the markets are happy with the products of the company and that people want to buy from the same company.
Determinants of Demand
When factors other than price change, demand will change. These are the determinants of the demand
1. Income: A rise in a person’s income will lead सप्लाई कर्व में शिफ्ट to an increase in demand a rich consumer demands more.
2. Consumer Preferences: Favorable change leads to an increase in demand; unfavorable change leads to a decrease.
3. Number of Buyers: The more buyers lead to an increase in demand; fewer buyers lead to decrease.
4. Price of related goods:
a. Substitute goods are those goods that can be used to replace each other. Price of substitute and demand for the other goods are directly related.
b. Complement goods are those that can be used together. Price of complement and demand for the other goods are inversely related.
5. Expectation of future:
a. Future price: Consumers’ current demand will increase if they expect higher future prices. Their demand will decrease if they expect lower future prices.
b. Future income: Consumers’ current demand will increase if they expect higher future income. Their demand will decrease if they expect lower future income.
Demand and supply refer to the relationship price has with the quantity consumers demand and the quantity supplied by producers. As price increases, quantity demanded decreases and quantity supplied increases.Perfect competition represents an economy with many businesses competing with one another for consumer interest and profits.Knowing this will lead countries to specialize and trade products amongst each other rather than each producing all the products it सप्लाई कर्व में शिफ्ट needs.
CBSE Board Exam 2020: Check Important Questions & Answers for Class 12 Economics (Micro) - Chapter 4: Theory of Firm Under Perfect Competition
If you are appearing for CBSE Class 12 th Board exams 2020, check this list of important questions and answers from Chapter 4 of Microeconomics.
CBSE Class 12 th Economic exam is scheduled for 13 th March 2020. In this article we have complied a list of important questions from Chapter 4 of Part A (Microeconomics): Theory of Firm Under Perfect Competition. Questions given below are important questions and are expected to be asked in Class 12 Economics board exam 2019-20.
Ques 1 The Total Revenue earned by selling 20 units is Rs. 700. Marginal Revenue earned by selling 21st unit is Rs.70 . The value of Total Revenue
earned by selling total 21 units will be ____________. (Choose the correct alternative)
Solution: c) 770
Ques 2 If the market supply of a commodity X changes due to सप्लाई कर्व में शिफ्ट improvement in technology, the market supply curve will ________. (Fill up the blank)
Solution: shift rightwards
Ques 3 If the supply curve is a straight line parallel to the vertical axis (Y-axis), supply of the good is called as _________. (Fill up the blank)
(a) Unitary Elastic Supply
(b) Perfectly Elastic Supply
(c) Perfectly Inelastic Supply
(d) Perfectly Elastic Demand
Solution: c) Perfectly Inelastic Supply
Ques 4 If the percentage change in quantity supplied of commodity X is more than the percentage change in price of the commodity X, the coefficient of price elasticity of supply would be _______________ : (Choose the correct alternative)
(a) Es = 1
(b) Es < 1
(c) Es = 0
(d) Es > 1
Solution: d) Es > 1
Ques 5 Which of the following statements are true or false ? Give valid reasons in support of your answer.
(a) Average cost curve cuts Average variable cost curve, at its minimum level.
(b) Average product curve and Marginal product curve are ‘U-shaped’ curves.
(c) Under all market conditions, Average revenue and Marginal revenue are equal to each other.
(d) Total cost curve and Total variable cost curve are parallel to each other.
Solution: a) The given statement is false. Average Cost curve is the vertical summation of Average Variable Cost and Average Fixed Cost(AC = AFC + AVC). Since, Average Fixed Cost cannot be zero (AFC ≠ 0) the two curves would never touch each other.
b) The given statement is false. As per Laws of Returns to a Factor, Average Product Curve and Marginal Product Curve both rise and then tend to fall. Thus, the two curves are inverted ‘U’ shaped curves and not ‘U’ shaped curves.
c) The given statement is false.This condition is obtained in perfect competition market a price remains constant only under the perfect competition a market.
d) The given statement is true. The difference of the two is represented by Total Fixed Cost (TFC). TFC remains constant at all levels of output. It represents the vertical distance between the two curves making them parallel to each other.
Ques 6 The coefficient of price elasticity of supply of a good is 3. It is known as ___________ . (Choose the correct alternative)
(a) Unitary Elastic Supply
(b) Perfectly Inelastic Supply
(c) Elastic Supply
(d) Inelastic Supply
Solution: c) Elastic supply.
Ques 7 Distinguish between ‘Supply’ and ‘Quantity Supplied’.
Solution: Supply refers to the different quantities of a commodity that the producer would be willing to sell at different prices. Quantity supplied refers to the quantity of the commodity that a seller would be willing to sell at a given price.
The first bi-monthly meeting of the RBI's Monetary Policy Committee (MPC) for the current financial year reaffirmed its focus on inflation management. While the MPC voted to keep the policy rate unchanged at 4 percent and retained its accommodative stance, the wording was changed to . "remain accommodative while focusing on withdrawal of accommodation to ensure that inflation remains within the target going forward, while supporting growth." This statement sets the stage for a shift to a neutral stance in the next meeting and policy rate hikes in the subsequent meetings. RBI has announced withdrawal of some of the steps taken during the pandemic to support the economy. These will foster normalisation of the monetary policy.
The RBI acknowledged that the disruptions caused by the Russia-Ukraine crisis have upended their growth and inflation outlook. The RBI has steeply revised its inflation projection from 4.5 percent to 5.7 percent for the current financial year. The projection is based on an average global crude oil price of USD 100 per barrel. While oil prices could swing either way, elevated non-fuel prices also pose a substantial upside risk to inflation. The FAO’s Food Price Index, a gauge of global food prices posted a record growth of 12.6 percent from February. The surge in index was broad-based, driven by rise in prices of vegetable oils, cereals, meat, sugar and dairy products. Input cost pressures emerging from a broad-based surge in prices of industrial raw materials and supply chain disruptions are also likely to pose a sustained upward pressure on inflation.
During the last monetary policy announcement, there were concerns that RBI is falling behind the curve in managing inflation at a time when globally, many central banks included the U.S Federal Reserve, and the Bank of England have started raising rates and signalling aggressive rate hikes and reduction of balance-sheet to normalise monetary policy and tame inflation.
While the RBI has been managing liquidity infused into the system during the pandemic through the Variable Rate Reverse Repo Auctions (VRRR) to withdraw liquidity and Variable Rate Repo auctions to inject liquidity, सप्लाई कर्व में शिफ्ट it has now formalised the Liquidity Adjustment Framework (LAF). The LAF is a framework to absorb and inject liquidity into the banking system.
The RBI has introduced the Standing Deposit Facility (SDF) as the lower bound of the LAF corridor to absorb liquidity. The idea of the SDF was first mooted by the Urjit Patel Committee report on monetary policy framework. The RBI Act was amended through the Finance Act of 2018 to allow RBI to use this instrument.
The SDF will be a facility available to banks to park their funds. The SDF will serve as the standing liquidity absorption facility at the lower end of the LAF corridor. At the upper end of the corridor, is the Marginal Standing Facility (MSF) to inject liquidity. With the introduction of the SDF, the fixed rate reverse repo rate seems to be defunct. Through the SDF, the RBI can absorb liquidity without placing government securities as collateral, hence it will give greater flexibility to the RBI.
The LAF is now a symmetric corridor with a width of 50 basis points. The policy repo rate is at the centre of the corridor, with MSF 25 basis points above the policy rate and the SDF 25 basis points below the policy rate.
The change also marks a shift away from reverse सप्लाई कर्व में शिफ्ट repo being the effective policy rate. During the pandemic, the reverse repo rate was reduced to incentivise banks to park lesser funds with RBI and lend more. This had led to the breakdown of the symmetric LAF corridor. With the introduction of the SDF, the RBI has reverted to a symmetric liquiidty management corridor.
While on the face of it, there are no rate hikes, the shift from reverse repo rate to the SDF signals a tightening of monetary policy. There is a 40 basis points increase in the floor rate. It may be argued that the RBI has been absorbing liquidity through variable reverse repo auctions where the cut-off rates are closer to 4 percent. In the medium run, the call money rate would move towards the new LAF corridor, thus bringing orderly conditions in the money market.
In most parts of February and March, yields on government bonds were range bound as a number of auctions were cancelled. But since the announcement of the half-yearly borrowing program, yields have been inching up. Government is expected to borrow Rs 8.45 trillion in the first half of the current financial year. While there were no explicit announcements to cool the yields, through measures like G-SAP, Operation Twist or Open Market Operations (OMOs), the RBI raised the limit under the Held-to Maturity category for banks from 22 percent to 23 percent. This move will insulate banks, to a certain extent from mark-to-market losses as yields inch up. It will likely ensure demand for government bonds by banks.
As RBI begins to normalise liquidity in a calibrated manner, its ability to manage bond yields will likely be limited. Yields on bonds are likely to inch up and remain above the 7 percent mark.
Going forward, the trade-off between managing inflation and the borrowing program of the government will become challenging. For now the RBI has rightly decided to place top priority on inflation management. This will help in maintaining the credibility of the inflation targeting framework.
The views expressed in the post are those of the authors only. No responsibility for them should be attributed to NIPFP.
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