NCERT Solutions for Class 12 Macro Economics Excess Demand and Deficient Demand

NCERT Solutions for Class 12 Macro Economics Excess Demand and Deficient Demand

NCERT Solutions for Class 12 Macro Economics Excess Demand and Deficient Demand is designed and prepared by the best teachers across India. All the important topics are covered in the exercises and each answer comes with a detailed explanation to help students understand concepts better. These NCERT solutions play a crucial role in your preparation for all exams conducted by the CBSE, including the JEE.

NCERT TEXTBOOK QUESTIONS SOLVED

Ans.When in an economy aggregate demand exceeds “aggregate supply at full employment level”, the demand is said to be an excess demand.

Ans. When in an economy aggregate demand exceeds “aggregate supply at full employment level”, the demand is said to be an excess demand and the gap is called inflationary gap.

Ans. When in an economy aggregate demand falls short of aggregate supply at full employment level, the demand is said to be as deficient demand.

Ans. When in an economy aggregate demand falls short of aggregate supply at full employment level, the demand is said to be deficient demand and the gap is called deflationary gap.

Ans. Increase in cash reserve ratio.
Increase in marginal requirement.

Ans. Increase in margin requirements discourages borrowings and decreases the aggregate demand

Ans. Full employment equilibrium refers to the situation where aggregate demand = aggregate supply and all those who are able to work and willing to work (at the existing wage rate) are getting work.

Ans. Involuntary unemployment refers to a situation in which all able and willing persons to work at existing wage-rate do not find work. They are rendered unemployed against their wish. Hence, it is termed as involuntary unemployment.

Ans. No, it is not necessary that full employment occurs when AD = AS. Equilibrium can be achieved at full employment level, under employment level or at over full employment level.

Ans. Full employment equilibrium refers to a situation when equilibrium is attained i.e., aggregate demand is equal to aggregate supply at full employment level.

Ans. Underemployment equilibrium refers to a situation when equilibrium is attained i.e., aggregate demand is equal to aggregate supply below full employment level or when resources are not fully employed.

Ans. Over full employment level refers to a situation when equilibrium is attained, i.e., aggregate demand is equal to aggregate supply beyond the full employment level.

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