Economics Class XII: Microeconomics and Trade
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Questions and Answers

What is the purpose of trade?

Trade is the act of exchanging goods, services, or resources between individuals, groups, or countries to satisfy mutual needs or wants.

What are the key benefits of trade?

  • Specialization (correct)
  • Forms of Trade (correct)
  • Global Trade (correct)
  • Mutual Benefit (correct)

    • National trade refers to the exchange of goods between different countries.

    False

    Explain the difference between national trade and international trade.

    <p>National trade refers to the exchange of goods and services within a single country, whereas international trade involves the exchange of goods and services between different countries.</p> Signup and view all the answers

    What are the 'determinants of price elasticity of supply'?

    <p>The determinants of price elasticity of supply are: (Time Factor), (Nature of Commodity), (Risk Taking), and (Availability of Facilities for Expanding Output).</p> Signup and view all the answers

    Explain the concept of 'price elasticity of supply' and how it is calculated using percentage method.

    <p>Price elasticity of supply measures the responsiveness of the quantity supplied to a change in price. The percentage method calculates this by dividing the percentage change in quantity supplied by the percentage change in price.</p> Signup and view all the answers

    What are some examples of national trade and international trade?

    <p>Examples of national trade include a company selling products across different states or provinces in a country. An example of international trade is a company importing electronics from Japan or exporting agricultural products to Europe.</p> Signup and view all the answers

    Describe the scenario of the 'Orange and the Bread' story, highlighting the key concept of trade.

    <p>The story highlights the idea of mutual benefit in trade. Mia had an orange but was hungry, while Sam had bread but was thirsty. They agreed to trade, with Mia giving Sam half her orange in exchange for a piece of bread. This trade solved both their problems, demonstrating how exchange can satisfy mutual needs and create a win-win situation for both parties.</p> Signup and view all the answers

    Study Notes

    Course Details

    • Date: 13-11-24
    • School: Radhasoami Adivasi Higher Secondary School (Rajaborari, MP)
    • Subject: Economics
    • Branch: Economics
    • Class: XII
    • Period: 3rd
    • Topic(s): Microeconomics, Trade, Measurement of Price Elasticity of Supply

    The Orange and the Bread

    • Mia had a juicy orange, but was hungry.
    • Sam had a loaf of bread but was thirsty.
    • They met and exchanged half an orange for a piece of bread.
    • Both benefited from the trade.
    • This illustrates the concept of mutual gain and beneficial trade.

    Meaning and Concept of Trade

    • Trade is the exchange of goods, services, or resources.
    • Motivated by mutual needs.
    • Specialization allows individuals and groups to focus on what they're best at while trading for other needs.
    • Can be barter (goods for goods) or use money.
    • Global trade involves countries exchanging goods they have in surplus for goods they lack.
    • Promotes cooperation and satisfies diverse needs.

    National Trade

    • Exchange of goods and services within a single country.
    • No need for international regulations or foreign currencies.
    • Example: Selling goods between states or provinces within the same country.
    • Focuses on the domestic market.

    International Trade

    • Exchange of goods and services between different countries.
    • Involves imports and exports.
    • Requires dealing with international regulations, tariffs, and customs.
    • Example: Importing electronics from Japan or exporting agricultural products to Europe.
    • Expands global markets and business opportunities.

    Measurement of Price Elasticity of Supply

    • A concept in economics describing how responsive quantity supplied is to changes in price.
    • Home work requires an explanation of the meaning of trade, with examples of national and international trade.
    • Explores the percentage method for calculating elasticity.
    • Key topic: Determinants of price elasticity of supply.
    • Subtopics include, but aren't limited to: The nature of the commodity; risk taking; availability of facilities for expanding output; time factor and 15%.

    Percentage Method of Price Elasticity of Supply

    • Calculating elasticity using percentage changes in price and quantity supplied.
    • (Es) = 2.5 (This is the calculated elasticity from the examples given.)
    • Example calculations with specific numbers (50, 45, 200, 150) are provided throughout to demonstrate the method.
    • Illustrating the calculation of various elasticity metrics relevant to the concepts.

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    Lesson Plan: 4 (Madhu) - Economics, Grade 12

    Description

    Explore the fundamental concepts of microeconomics, particularly focusing on trade and the measurement of price elasticity of supply. This quiz delves into the meaning of trade and how mutual gain can be achieved through exchange. Understand the principles of specialization and the dynamics of national and global trade.

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