Theory of consumer behaviour — Economics STD 12 Humanities & Commerce — Question

Explain the change in demand of a good on account of change in prices of related goods.

OR

How is demand for a commodity affected by the rise in price of related goods? Explain with the help of diagram.

OR

Explain how the demand for a good is affected by the price of its related goods. Give examples.

Given the C = 100 + 0.75Y is a consumption function (where C = consumption expenditure and Y-national income) and investment expenditure is ₹ 800. On the basis of this information calculate:

1. Equilibrium level of national income.
2. Savings at equilibrium level of national income.

Giving reasons, state whether the following statements are true or false.

1. When MPC is zero, the value of investment multiplier will also be zero.
2. Value of Average Propensity to Consume can never be less than zero.

Define iso-quant curve.

There are no selling costs under perfect competition. Why?

Who prints and circulates currency in India?

Define an indifference map. Explain why an indifference curve to the right shows more utility level?

At what level of price do the firms in a perfectly competitive market supply when free entry and exit is allowed in the market? How is equilibrium quantity determined in such a market?

Complete the following table:

Income	Saving	Marginal Propensity to Consume	Averge Propensity to Save
0	- 12	-	-
20	- 6	-	-
40	0	-	-
60	6	-	-

Ceteris Paribus, if the government provides subsidies on electricity bills, what would be the likely change in the market demand of desert coolers?