Class 12 Microeconomics Sandeep Garg Solutions Chapter 3 – Demand
FAQs on Sandeep Garg Class 12 Microeconomics Chapter 3 Solutions
1. What are the key topics covered in the solutions for Sandeep Garg's Class 12 Microeconomics Chapter 3, 'Demand'?
The solutions for Chapter 3, 'Demand,' provide step-by-step explanations for all core concepts as per the CBSE 2025-26 syllabus. This includes defining demand, understanding the determinants of demand, constructing a demand schedule and curve, and solving problems related to the Law of Demand. It also clarifies the difference between a shift in the demand curve and movement along it.
2. How do you correctly derive the market demand curve from individual demand schedules in the chapter solutions?
The correct method, as shown in the solutions, involves a horizontal summation of individual demands at each price level. To solve this:
- List the prices in one column.
- In subsequent columns, list the quantity demanded by each individual (e.g., Individual A, Individual B) at each price.
- Create a final column for 'Market Demand' by adding the quantities demanded by all individuals at each corresponding price.
- Plot these market demand points on a graph to derive the market demand curve.
3. What is the step-by-step process for solving a numerical problem on the price elasticity of demand using the percentage method?
To solve for price elasticity of demand (Ed) using the percentage method as per the CBSE pattern, follow these steps:
- Step 1: Identify the initial price (P) and initial quantity (Q).
- Step 2: Identify the new price (P1) and new quantity (Q1).
- Step 3: Calculate the percentage change in quantity demanded: [(ΔQ/Q) x 100], where ΔQ = Q1 - Q.
- Step 4: Calculate the percentage change in price: [(ΔP/P) x 100], where ΔP = P1 - P.
- Step 5: Divide the result from Step 3 by the result from Step 4. The formula is: Ed = (% Change in Quantity Demanded) / (% Change in Price).
4. How do the solutions help differentiate between a 'shift in the demand curve' and a 'movement along the demand curve'?
The solutions clarify this distinction by focusing on the cause of the change:
- A movement along the demand curve (also called a change in quantity demanded) is shown to be caused *only* by a change in the own price of the commodity. An upward movement signifies a contraction in demand, while a downward movement signifies an extension.
- A shift in the demand curve (also called a change in demand) is caused by changes in factors *other than* the commodity's own price, such as income, tastes, or the price of related goods. A rightward shift means an increase in demand, and a leftward shift means a decrease.
5. Why is it crucial to state 'ceteris paribus' when solving questions related to the Law of Demand?
Stating 'ceteris paribus' (meaning 'other things being equal') is crucial because the Law of Demand isolates the relationship between a commodity's price and the quantity demanded. For a full-marks answer, you must assume that all other factors influencing demand—like consumer income, prices of related goods, and tastes—remain constant. Without this assumption, the inverse relationship between price and quantity cannot be established correctly, as a change in another factor could counteract the effect of the price change.
6. How can one solve a problem where a change in consumer income affects the demand for a good?
To solve such a problem, you must first identify the type of good:
- Normal Good: If income increases, demand increases (curve shifts right). If income decreases, demand decreases (curve shifts left).
- Inferior Good: If income increases, demand decreases (curve shifts left). If income decreases, demand increases (curve shifts right).
The solution involves illustrating this with a diagram showing a shift in the original demand curve, not a movement along it, because the determining factor is income, not the good's own price.
7. What is the most common mistake students make when solving questions on Giffen goods, and how can it be avoided?
A common mistake is simply stating that Giffen goods violate the Law of Demand without explaining the mechanism. To solve this correctly, you must explain that for a Giffen good, the negative income effect (due to it being a strong inferior good) is more powerful than the negative substitution effect. This causes the consumer to buy more of the good when its price rises. The correct method involves showing that a price rise leads to a decrease in real income, forcing the consumer to buy more of this basic staple and less of more expensive substitutes.
8. How are the solutions for the unsolved practical questions in Sandeep Garg's Chapter 3 structured?
The solutions for the unsolved practical questions are designed to provide a clear, step-by-step methodology that aligns with the CBSE 2025-26 examination pattern. Each solution typically includes:
- A clear statement of the given data.
- The relevant formula or economic principle being applied (e.g., Law of Demand, formula for elasticity).
- A detailed, step-by-step calculation or logical derivation.
- A final, concluding statement that directly answers the question asked.
