Question

Q2. Data response Questions: The demand and supply schedules of good X are given below in the table below. Px ($) Quantity demanded Quantity supplied 1 120 0 2 100 20 3 80 40 4 60 60 5 40 80 6 20 100 A) Define what is meant by the quantity demanded and the quantity supplied

Answer 1

ANSWER-

(A) Quantity Demanded and Quantity Supplied-

Quantity Demanded - Quantity demanded means the total amount of goods or services which the consumer demand at a particualr price at a particualr period of time. Quantity demaned depends on the price of the goods or services. if the price of the goods or services rises than less quantity will be demanded by the consumer and if the price of goods and services fall then more quantity will be demanded by the consumer. It also depnds on many other factors like taste and prefernces of the consumer, price of related goods, income of the consumer, population etc.

Quantity Supplied - Quantity supplied means the total amount of good and services which the suppliers are willing to supply at at particulae price and at at particular period of time. Quantity supplied depneds of price. If the price of the goods or services rises the quantity supplied will rise as it will seem more profitable to the suppliers and if the price of goods and services fall the quantity demanded falls as it will seem less profitable to the suppliers. The quantity supplied also depend on other factors like price of inputs, tax rate, availability of resources, price of related goods, competition in the market etc.