Class 11 Economics Important Chapter 2 Consumer’s Equilibrium

Class 11 Economics Important Chapter 2 Consumer’s Equilibrium Solutions English Medium As Per AHSEC New Syllabus to each chapter is provided in the list so that you can easily browse through different chapters ASSEB Class 11 Economics Important Solutions and select need one. AHSEC Class 11 Economics Additional Notes English Medium Download PDF. HS 1st Year Economics Important Solutions in English.

Class 11 Economics Important Chapter 2 Consumer’s Equilibrium

Also, you can read the NCERT book online in these sections Solutions by Expert Teachers as per Central Board of Secondary Education (CBSE) Book guidelines. Assam AHSEC Board Class 11 Economics Additional Question Answer are part of All Subject Solutions. Here we have given HS 1st Year Economics Important Notes in English for All Chapters, You can practice these here.

Consumer’s Equilibrium

Chapter: 2

PART – A : MICROECONOMICS

IMPORTANT QUESTION AND ANSWER

 Short Type Question and Answer:

1. What is the meaning of utility in economics?

Ans: Utility refers to the want-satisfying power of a commodity, or the satisfaction that a consumer derives from consuming a particular commodity.

2. Why is utility considered subjective?

Ans: Utility is subjective because it varies from person to person, depending on the intensity of their wants and individual preferences.

3. How does utility differ from usefulness?

Ans: Utility refers to the satisfaction derived from a commodity, while usefulness refers to the practical application of a commodity. A commodity may have utility but may not necessarily be useful (e.g., wine for a drunkard).

4. What is total utility?

Ans: Total utility is the sum of satisfaction derived from consuming different quantities of a commodity.

5. Define marginal utility.

Ans: Marginal utility is the additional satisfaction derived from consuming one more unit of a commodity.

6. What is the relationship between marginal utility and total utility?

Ans: Total utility is the sum of marginal utilities from all units consumed. As marginal utility diminishes, total utility increases at a decreasing rate.

7. What is the law of diminishing marginal utility?

Ans: The law of diminishing marginal utility states that as more units of a commodity are consumed, the additional satisfaction (marginal utility) decreases.

8. What happens to total utility when marginal utility is zero?

Ans: When marginal utility is zero, total utility is at its maximum, meaning the consumer has no further desire to consume more of the commodity.

9. Explain the concept of consumer equilibrium.

Ans: Consumer equilibrium is the point where the consumer allocates their income across goods in such a way that maximizes their satisfaction, and no change in consumption is desired.

10. What does the term ‘marginal utility of money’ refer to?

Ans: The marginal utility of money refers to the additional satisfaction derived from spending an additional unit of money on a commodity.

11. What is the condition for a consumer to be in equilibrium when consuming two commodities?

Ans: Consumer equilibrium is achieved when the marginal utility per rupee spent on each commodity is equal for all goods.

12. How is per rupee marginal utility calculated?

Ans: Per rupee marginal utility is calculated by dividing the marginal utility of a commodity by its price.

13. What happens when the marginal utility of a commodity is negative?

Ans: When the marginal utility of a commodity becomes negative, total utility starts to decline, and the consumer experiences disutility.

14. What is the significance of the point of satiety?

Ans: The point of satiety occurs when marginal utility becomes zero, and the consumer reaches maximum satisfaction with the consumption of the commodity.

15. What is the role of the law of equi-marginal utility in consumer equilibrium?

Ans: The law of equi-marginal utility helps a consumer allocate their income between commodities so that the marginal utility per rupee spent on each commodity is equal, ensuring maximum satisfaction.