Micro

Market Equilibrium

Medium

Suppose an individual buy 30 bananas when its price is Rs. 10 per banana. When the price increases to Rs. 14 per banana, she reduces her demand to 24 bananas. In this case,what will be the price elasticity of demand?

0.3

0.2

0.5

0.4

✅ Correct Option: 3

Option 3: 0.5 -> Price elasticity of demand is calculated using the formula: Ed = (% change in quantity / % change in price). Here, quantity changes from 30 to 24 (change = -6, so % change = -6/30 = -20%), and price changes from Rs. 10 to Rs. 14 (change = 4, so % change = 4/10 = 40%). Therefore, Ed = |-20%/40%| = |-0.5| = 0.5. This indicates inelastic demand since the elasticity is less than 1. -> correct

2025: 26 May Shift 2

Match List-I with List-II

List-I	List-II
(A) Increase in demand > Increase in Supply	(I) Increase in both equilibrium price and quantity.
(B) Increase in demand < Increase in Supply	(II) Decrease in both equilibrium price and quantity.
(C) Increase in demand = Increase in Supply	(III) Decrease in equilibrium price but increase in equilibrium quantity.
(D) Decrease in demand < Decrease in supply	(IV) Increase in equilibrium quantity but no change in equilibrium price.

Choose the correct answer from the options given below:

2025: 29 May Shift 2

Arrange the following statements in chronological sequence about how government intervention in the form of price control has an impact on the market.

(A) There will be an excess demand for sugar in the market at that price.

(B) Government-imposed upper limit on the price of sugar.

(D) It could end up creating a shortage of sugar in the market.

Choose the correct answer from the options given below:

2025: 2 June Shift 1

When will increase in supply bring down the price, leaving the quantity demanded unchanged?

2026: 11 May Shift 2

'Through the minimum wage legislation, the government ensures that the wage rate of labourer's does not fall below a particular level.'

The said statement implies which of the following concept.

2026: 12 May Shift 1

Match List-I with List-II

List-I	List-II
(A) Increase in demand and no change in supply	(I) Equilibrium quantity decreases.
(B) Both demand and supply increase	(II) Equilibrium quantity increases.
(C) Decrease in supply and no change in demand	(III) Change in price depends on magnitude of shift
(D) Increase in demand and decrease in supply	(IV) Equilibrium price increases.

Choose the correct answer from the options given below:

2026: 15 May Shift 1

When demand of a commodity is equal to that of its supply in the market then the price of this commodity is called?

Suppose an individual buy 30 bananas when its price is Rs. 10 per banana. When the price increases to Rs. 14 per banana, she reduces her demand to 24 bananas. In this case,what will be the price elasticity of demand?

Solution

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