Chapter 12 Solutions — Understanding Markets

Questions and Activities

1. 1.
   What are the main features of a market? Recall a recent visit to a market to purchase a product. What are the different features of a market that you observed during this visit?
2. 2.
   Remember the epigraph from a famous economist at the beginning of the chapter? Discuss its relevance in the context of the chapter you have read.
3. 3.
   In the example of buying and selling of guavas, imagine that the seller is getting a good price, and is able to make a profit. He will try to get more guavas from farmers to be able to sell them at the same price and increase his earnings. What is the farmer likely to do in this kind of a situation? Do you think he will start thinking about the demand for guavas in the next season? What is…
4. 4.
   Match the following types of markets with their characteristics: Physical market, Online market, Domestic market, International market, Wholesale market, Retail market Characteristics: Goods and services flow outside the nation's boundaries; Deals in bulk quantities; Serves the final consumers with goods and services; Requires physical presence of buyers and seller; Buyers and sellers meet…
5. 5.
   Prices are generally determined by the interaction between demand from buyers and supply by sellers. Can you think of products where prices are high despite lesser number of buyers demanding the product? What could be the reasons for that?
6. 6.
   Look at the real life situation that a retail seller of vegetables encountered: A family came to shop for vegetables. The price of beans that the seller on the cart was offering was ₹30/kg. The lady started to bargain with the seller to bring the price down to ₹25/kg. The seller protested and refused to sell at that price saying he would make a loss at that price. The lady walks away. The family…
7. 7.
   There are some districts in India that are famous for growing tomatoes. However, during some seasons, the situation is not good for farmers. With a large quantity of harvest, there are reports of farmers throwing away their produce and all their hard work going to waste. Why do you think farmers do this? What role can wholesalers play in such situations? What are the possible ways of ensuring…
8. 8.
   Have you heard about or visited a school carnival/fair organized by your school or any other school? Discuss with your friends and teachers about the kind of activities organized by students there. How do they conduct selling and negotiation with the buyers?
9. 9.
   Choose any 5 products and check out the label with the certification signs discussed in the chapter. Did you find products that did not have a logo? Why do you think this is so?
10. 10.
    You and your classmates have manufactured a soap bar. Design a label for its packaging. What in your opinion should be mentioned on the label for the consumer to know the product better?