MICROECONOMICS CH : 13 MARKET EQUILIBRIUM UNDER PERFECT COMPETITION AND EFFECTS OF SHIFTS IN DEMAND AND SUPPLY — Economics STD 11 Commerce — Question

If the prices of other goods, the consumer's income and her tastes and preferences remain unchanged, the amount of a good that the consumer optimally chooses, becomes entirely dependent on its price. The relation between the consumer's optimal choice of the quantity of a good and its price is very important and this relation is called the demand function. Thus, the consumer's demand function for a good gives the amount of the good that the consumer chooses at different levels of its price when the other things remain unchanged. The graphical representation of the demand function is called the demand curve. The relation between the consumer's demand for a good and the price of the good is likely to be negative in general. In other words, the amount of a good that a consumer would optimally choose is likely to increase when the price of the good falls and it is likely to decrease with a rise in the price of the good.
1. Do you agree with the view that law of demand need not necessarily fail in case of inferior goods?
2. Cross price effect occurs in case of substitute goods, and not in case of complementary goods. Comment.

Following are the marks obtained by 100 students in Economics. Calculate the average marks by using assumed mean method (take 35 as assumed mean).

Marks	0-10	10-20	20-30	30-40	40-50	50-60
Number of students	5	10	25	30	20	10

Find out median from the following data:

Marks	0-10	10-20	20-30	30-40	40-50
No. of Students	08	30	40	12	10

MC is only a variable cost. Why?

A consumer's budget is ₹40. He is buying Good-1 and Good-2. Price of Good-1 is ₹8 per unit, and of Good-2 is ₹10 per unit. Draw a budget line on the basis of these figures.

From the following table, find out the level of the output at which the producer will be in equilibrium. Give reasons for your answer.

Output (Units)	Marginal Revenue (Rs.)	Marginal Revenue (Rs.)
1	8	10
2	8	8
3	8	7
4	8	8
5	8	9

Explain the conditions leading to maximisation of profits by a producer. Use marginal cost and marginal revenue approach.

Calculate standard deviation and coefficient of variation from the following data with the help of direct method.

S. No.	1	2	3	4	5
Marks	10	12	13	15	20

Given the market price of a good, how does a consumer decide as to how many units of that good to buy? Explain.

What are the merits and limitations of Spearman's rank correlation?