The Price Puzzle: What Drives the Market — Class 9 MCQs with Answers

The Price Puzzle: What Drives the Market — important questions & MCQs with answers (Class 9 Social Science)

14 solved questions from this chapter's difficulty levels, each with its answer and explanation. The other 61 are timed and scored when you sign in.

1. Q1Easy

   In economics, what is a 'market'?

   A.Only a physical shop where goods are kept

   B.A place where only the government sells things

   C.A building used only for storing grain

   D.Any arrangement that brings buyers and sellers together to exchange goods or services✓ Correct

   Answer: D. Any arrangement that brings buyers and sellers together to exchange goods or services

   Explanation: A market is any arrangement, physical or virtual, that brings buyers and sellers together to exchange goods and services.

2. Q2Easy

   In economics, 'demand' for a good means:

   A.The total quantity produced by sellers

   B.The desire to have a good even without money to pay

   C.The quantity of a good buyers are willing and able to buy at a given price✓ Correct

   D.The cost of producing the good

   Answer: C. The quantity of a good buyers are willing and able to buy at a given price

   Explanation: Demand is the quantity of a good that buyers are both willing and able to purchase at a given price during a period of time.

3. Q3Easy

   In economics, 'supply' refers to:

   A.The tax charged on a good

   B.The total money buyers have

   C.The wish of buyers to own a good

   D.The quantity of a good sellers are willing and able to sell at a given price✓ Correct

   Answer: D. The quantity of a good sellers are willing and able to sell at a given price

   Explanation: Supply is the quantity of a good that sellers are willing and able to offer for sale at a given price during a period of time.

4. Q4Easy

   The price at which the quantity demanded equals the quantity supplied is called the:

   A.Cost price

   B.Discount price

   C.Tax price

   D.Equilibrium price✓ Correct

   Answer: D. Equilibrium price

   Explanation: The equilibrium price is the price at which quantity demanded equals quantity supplied, clearing the market.

5. Q5Easy

   A vegetable mandi where farmers sell to local buyers is an example of which type of market?

   A.A national market

   B.A local market✓ Correct

   C.An online market

   D.An international market

   Answer: B. A local market

   Explanation: A vegetable mandi serving buyers from the nearby area is a local market because exchange happens within a limited geographic area.

6. Q6Easy

   According to the law of demand, when the price of a good rises (other things remaining the same), its quantity demanded usually:

   A.Rises

   B.Stays exactly the same

   C.Becomes zero immediately

   D.Falls✓ Correct

   Answer: D. Falls

   Explanation: The law of demand states an inverse relationship: as price rises, quantity demanded falls, other factors held constant.

7. Q7Medium

   Why is an online shopping app considered a market even though buyers and sellers never meet face to face?

   A.Because the government runs it

   B.Because it has a physical building

   C.Because it brings buyers and sellers together to exchange goods, even if only virtually✓ Correct

   D.Because it does not use money

   Answer: C. Because it brings buyers and sellers together to exchange goods, even if only virtually

   Explanation: A market is defined by the exchange between buyers and sellers, not by physical contact; a virtual platform that enables this exchange is still a market.

8. Q8Medium

   Tea and coffee are substitutes. If the price of tea rises sharply, what happens to the demand for coffee, other things being equal?

   A.Demand for coffee tends to decrease

   B.Demand for coffee tends to increase✓ Correct

   C.Demand for coffee becomes zero

   D.Demand for coffee is unaffected by tea's price

   Answer: B. Demand for coffee tends to increase

   Explanation: When the price of a substitute (tea) rises, buyers shift to coffee, so the demand for coffee increases.

9. Q9Medium

   A sudden rise in the wages a bakery must pay its workers, with no change in bread prices, will most likely cause the bakery's supply of bread to:

   A.Become unlimited

   B.Increase

   C.Stay exactly the same forever

   D.Decrease✓ Correct

   Answer: D. Decrease

   Explanation: Higher input costs raise the cost of production, so at the same price the bakery supplies less, decreasing supply.

10. Q10Medium

    If the current market price of a good is above the equilibrium price, we would expect a:

    A.Shortage, which pushes the price up

    B.Perfect balance with no change

    C.Surplus, which pushes the price up

    D.Surplus, which pushes the price down✓ Correct

    Answer: D. Surplus, which pushes the price down

    Explanation: Above equilibrium, quantity supplied exceeds quantity demanded, creating a surplus that pushes the price down toward equilibrium.

11. Q11Medium

    Assertion (A): If coffee becomes more expensive while the price of tea stays the same, the demand for tea may increase. Reason (R): Tea and coffee are complementary goods, which are generally used together.

    A.Both A and R are true and R is the correct explanation of A

    B.Both A and R are true but R is not the correct explanation of A

    C.A is true but R is false✓ Correct

    D.A is false but R is true

    Answer: C. A is true but R is false

    Explanation: Tea and coffee are substitute goods that can replace each other, so when coffee's price rises some coffee drinkers may switch to tea and its demand increases; the assertion is true. Complementary goods, such as smartphones and earphones or cars and petrol, are the ones used together, so the reason is false.

12. Q12Hard

    In a mandi, ten farmers each sell almost identical potatoes and buyers can easily compare prices. One farmer tries to charge double. In this competitive setting, the most likely outcome is that:

    A.The mandi shuts down

    B.All farmers immediately raise their prices to match

    C.That farmer sells very little, as buyers move to other sellers' lower prices✓ Correct

    D.Buyers are forced to pay the higher price

    Answer: C. That farmer sells very little, as buyers move to other sellers' lower prices

    Explanation: With many sellers of identical goods and informed buyers, an individual cannot charge much above the market price without losing customers.

13. Q13Hard

    A demand schedule for ice cream shows: at Rs 30, 100 cups; at Rs 40, 80 cups; at Rs 50, 60 cups. These numbers are consistent with the law of demand because:

    A.As price rises, quantity demanded falls✓ Correct

    B.As price rises, quantity demanded rises

    C.Quantity demanded does not change

    D.Price and quantity demanded both fall together

    Answer: A. As price rises, quantity demanded falls

    Explanation: The schedule shows quantity demanded falling (100 to 80 to 60) as price rises (30 to 40 to 50), which is the inverse relation of the law of demand.

14. Q14Hard

    Read the case: 'Market forces would settle the price of a pulse at ₹90 per kg, but the government fixes a maximum price of ₹60 per kg.' Which outcome does the chapter warn such a measure can lead to?

    A.Producers lose motivation to supply, which may lead to reduced production and shortages✓ Correct

    B.Producers expand output to earn more, creating a surplus

    C.The price floor raises producers' incomes above the market level

    D.The market quickly settles at the equilibrium price of ₹90 per kg

    Answer: A. Producers lose motivation to supply, which may lead to reduced production and shortages

    Explanation: A maximum price set below the market level is a price ceiling. The chapter warns that when the government fixes prices below market levels, producers may lose motivation to supply, which may lead to reduced production and shortages. A price floor is a minimum limit, such as a minimum wage, not a maximum.

The Price Puzzle: What Drives the Market — FAQs

More Class 9 Social Science chapters

• 01Understanding Social Science
• 02Shaping of the Earth's Surface
• 03Atmosphere and Climate
• 04Early Humans and Beginning of Civilisation
• 05State and Society (upto 1000 CE)
• 06Democracy

Class 9 — other subjects

• Class 9 English chapters
• Class 9 Mathematics chapters
• Class 9 Science chapters