8 Questions
What are the two basic factors that influence the price of a commodity?
Demand and supply
How does the price of a commodity change with higher demand?
It becomes dearer
What happens if demand is more than supply for a commodity?
Imports will be used to meet the demand
What is the fundamental equation of commodity demand and supply?
Opening stock + Domestic production + imports = Domestic consumption + exports
How does seasonality impact the price of agricultural commodities during harvesting season?
Prices tend to come down due to increased supply
What effect does increased demand during the festival season have on the prices of precious metals like gold and silver?
Prices remain stronger
How do news and rumors affect commodity prices in the short term?
Significantly
What can lead to disruptions in the supply of globally demanded commodities like crude oil?
Political tensions in some parts of the globe
Test your understanding of the fundamental principles of demand and supply in economics with this quiz. Explore the relationship between commodity prices, demand, and supply, and enhance your knowledge of this essential economic concept.
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