**Law of Demand:** Price ↑ → Quantity Demanded ↓; Price ↓ → Quantity Demanded ↑ (inverse relationship).
**Demand Schedule:** Table showing quantity demanded at each price level.
**Demand Curve:** Downward-sloping line on graph; shows same inverse relationship graphically.
**Individual Demand:** One consumer's quantity demanded at different prices.
**Market Demand:** Sum of all individual consumers' demands = Q1 + Q2 + Q3... at each price.
**Purchasing Power:** How much one unit of currency can buy at a given time.
**Substitute Goods:** Can replace each other (tea ↔ coffee). Price ↑ of one → Demand ↑ for other.
**Complementary Goods:** Used together (phones + earphones). Demand ↑ for one → Demand ↑ for other.
**Other Demand Determinants:** Price of related goods, consumer income, taste/preference, season, trends, rumours.
Q1. Srivalli bought 2 kg mangoes when price was ₹100/kg. When price falls to ₹50/kg, she buys 3 kg. This change in quantity is due to:
Answer: A — The direct inverse relationship between price falling and quantity demanded increasing is the Law of Demand; other factors remained constant.
Q2. When the price of smartphone cartridges remains the same but printer demand increases, cartridge demand also rises. This demonstrates the relationship between:
Answer: B — Printers and cartridges are used together; increased printer demand leads to increased cartridge demand despite unchanged cartridge price.
Q3. Which of the following is NOT a reason for price changes in vegetables?
Answer: C — Shopkeeper's uniform colour has no economic connection to vegetable prices; only supply, demand, seasonality, and cost factors affect prices.
Q4. Market demand for mangoes at ₹100/kg is 12 kg (Srivalli 2 kg + Alex 4 kg + Israt 6 kg). If a fourth consumer Ravi joins with demand of 3 kg at same price, new market demand becomes:
Answer: B — Market demand is the sum of all individual demands; 2+4+6+3 = 15 kg at ₹100/kg price level.
Q5. When coffee price increases but tea price remains constant, tea demand rises. What does this example illustrate?
Answer: C — Substitute goods replace each other in consumption; price rise of one causes demand shift to the other, shown by coffee-to-tea switching.
Q6. Ramesh observes that the same flight seat costs ₹3,000 on Tuesday but ₹9,000 on Friday. Which concept best explains this price variation?
Answer: B — Weekend travel demand is higher than weekday demand; higher demand on Friday justifies higher prices for same seat, not price alone.
Q7. The demand curve in Fig. 9.3(b) for market demand is flatter than in Fig. 9.2(b) for individual demand because:
Answer: B — When price falls from ₹150 to ₹50, Srivalli's demand increases 2 kg but market demand increases 12 kg, creating flatter curve response.
Q8. For something to be counted as demand in economics, it must include:
Answer: C — Demand requires both desire (willingness) AND purchasing power (ability); desire alone without money is not economic demand.
Q9. Which scenario would cause the demand curve for automobiles to shift upward (not move along it)?
Answer: D — Higher incomes increase car demand at each price (shifts curve); higher petrol prices reduce complementary good demand, both shifting entire demand curve.
Q10. Which of the following statements about market demand is correct?
Answer: C — Market demand by definition aggregates (sums) all individual consumer demands at each price point; the multiple determines curve flatness, not steepness.
What is demand in economics?
The quantity of a product people are willing and able to buy at a particular price, depending on income, preferences, season, and purchasing power.
Define the Law of Demand with an example.
When price rises, quantity demanded falls; when price falls, quantity demanded rises—like mangoes: ₹150/kg → 1 kg bought, ₹50/kg → 3 kg bought.
What is the difference between individual demand and market demand?
Individual demand is one person's quantity demanded at different prices; market demand is the sum of all consumers' demands at each price level.
Give an example of substitute goods and explain their relationship.
Tea and coffee are substitutes; if coffee price rises, people switch to tea, increasing tea's demand even if tea's price stays the same.
What are complementary goods? Provide one example.
Goods used together for utility—smartphones and earphones; if smartphone demand rises, earphone demand also rises without price change.
How does consumer income affect demand?
Higher income increases purchasing power, enabling consumers to buy more goods or better quality products, raising quantity demanded.
What does a downward-sloping demand curve represent?
The inverse relationship between price and quantity demanded—as price decreases along the curve, quantity demanded increases.
Why is the market demand curve flatter than an individual demand curve?
Market demand aggregates many consumers, so the same price change creates a larger total quantity response than one person alone.
What must be present for something to count as demand?
Both the desire to buy AND the purchasing power to afford it; desire alone without ability to pay is not demand.
How do taste and preference changes affect demand?
When consumers' preferences shift toward a product, demand increases for that product even if its price and other factors remain unchanged.
Define demand in economics and explain why it is different from mere desire to buy a product. [2 marks]
Demand requires purchasing power (ability to pay) in addition to willingness; desire alone without money cannot be counted as economic demand.
Using the example of tea and coffee, explain how substitute goods affect each other's demand when prices change. [3 marks]
When coffee becomes expensive, people switch to cheaper tea; identify that price rise of one substitute → demand increase for other substitute, demonstrating inverse relationship between substitute good prices and demand.
The market demand for mangoes at ₹100/kg is 12 kg (from three consumers). Explain why the market demand curve is flatter than any individual consumer's demand curve, and what this reveals about market responsiveness to price changes. [5 marks]
Market demand aggregates many consumers so same price change produces much larger quantity change (e.g., price drop causes 12 kg market increase vs 2 kg individual increase); flatter slope indicates greater responsiveness, more buyers = larger total effect. Discuss real-world implication: markets respond more to prices than individuals do.
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