Q5 of 50 Page 1

When does the shift in the supply curve take place?

A shift in the supply curve takes place when there is a change in the factor affecting supply other than the own price of the good.


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24

Explain the role of the cash reserve ratio in controlling credit creation.

 27

Calculate net national product at a market price and private income

Net Current transfer to abroad 10


Private final consumption expenditure 500


Current transfer from government 30


Net factor income to abroad 20


Net export -20


Net indirect tax 120


National debt interest 70


Net domestic capital formation 80


Income accruing to government 60


Government final consumption expenditure 100

 6

What will be the effect of a 10 per cent rise in the price of a good on its demand if the price elasticity of demand is (a) Zero, (b) -1, (c) -2?

 10

When priceof a good rises from Rs 8 to Rs 10 per unit, the producer supplies 40 units more.Price elasticity of supply is 2. What is the quantity supplied before price change?Calculate.