Micro

Consumer Behaviour

Medium

The law of demand holds in which of the following condition?

Income effects > Substitution Effects

Substitution Effect > Income Effect

Substitution Effect =Income Effect

Substitution Effect = Income Effect= 0

✅ Correct Option: 2

The law of demand can fail only when a negative income effect (as for inferior goods) dominates the substitution effect, as in the Giffen case. So long as the substitution effect is stronger than any opposing income effect, quantity demanded falls when price rises and the law of demand holds.

2026: 11 May Shift 2

Suppose 6 bananas gives 15 units of total utility and 7 bananas gives 18 units of total utility. The Marginal Utility of the 7th banana will be _______.

2025: 27 May Shift 2

What is Consumer Price Index?

2025: 3 June Shift 1

How much units of Good Y can the consumer consume if she spends her entire income on that good?

2025: 14 May Shift 1

What causes an indifference curve to be convex to the origin?

Marginal utility
Market Rate of Exchange
Law of Diminishing Marginal Rate of Substitution
Law of Increasing Marginal Rate of Substitution

2025: 22 May Shift 2

Arrange the following concept emerges in context of consumer equilibrium.

(A) Transfer his expenditure from Good Y to Good X.

(B) Sacrifice more of Good Y to gain Good X.

(D) Suppose, Marginal Rate of Substitution (MRSxy) > Market Rate of Exchnage.

Choose the correct answer from the options given below:

2026: 11 May Shift 1

Suppose the price of the commodity is declined by 10%, as a result of which, the quantity demanded increased by 20%. Then, calculate the value of the elasticity of demand ( $e_D$ ) and confirm its type.

The law of demand holds in which of the following condition?

Solution

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CUET Economics Past Year Questions (Topic-Wise)