Problems Of Deficient Demand And Excess Demand
ICSE · Class 12 · Economics
Most important questions from Problems Of Deficient Demand And Excess Demand for ICSE Class 12 Economics board exam 2026. MCQs, short answer, and long answer questions with marks.
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Sample Questions
Which gap is associated with excess demand?
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Inflationary gap
Excess demand implies an inflationary gap.
What is the correct relationship between deficient demand and equilibrium?
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It leads to under-employment equilibrium
When AD is below full-employment AS, the economy settles at under-employment equilibrium.
What equilibrium results from excess demand?
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Over full employment equilibrium
Excess demand occurs when AD is above AS at full employment, leading to over full employment equilibrium.
Which policy pair is used to correct deficient demand?
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Fiscal policy and monetary policy
The chapter identifies fiscal policy and monetary policy as the two fundamental government policies for correction of demand disequilibrium.
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