Class 9 · Social ScienceNCERT 2026 Revised Syllabus
Chapter 9: The Price Puzzle: What Drives the Market (0908CH09)
Understanding Society India and Beyond
Explores how demand and supply drive the market, determine prices and reach equilibrium — and how government intervention can protect consumers and public welfare.
Chapter code: 0908ch09 · Book: Understanding Society India and Beyond · Class 9 Social Science
Find complete NCERT solutions for Class 9 Social Science, Understanding Society India and Beyond Chapter 9. Every question has a clear, step-by-step answer for chapter code 0908CH09.
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Section 1: The Big Questions (Chapter Opener)(4 questions)
1
What are the factors that influence the demand for and supply of goods and services in a market?
Ans.
Demand is influenced by price, income, taste, prices of related goods, population, seasonality, and future price expectations. Supply is influenced by price, cost of production, technology, number of sellers, and future expectations.
2
How are prices of goods and services determined through demand and supply interactions?
Ans.
Prices are determined at the point where quantity demanded equals quantity supplied, called market equilibrium. If demand exceeds supply, prices rise; if supply exceeds demand, prices fall until equilibrium is reached.
3
What is market equilibrium, and does it exist in the real world?
Ans.
Market equilibrium is the point where quantity demanded equals quantity supplied, clearing the market with no shortage or surplus. In reality, it rarely stays fixed, as constantly changing conditions keep shifting demand and supply.
4
How and why does the government intervene in the market?
Ans.
The government intervenes through price ceilings, price floors, regulation of monopolies, and provision of public goods to protect consumers, workers, and producers, since markets alone may not serve everyone fairly.
Think About It — Diminishing Marginal Utility (Demand)(1 questions)
1
What happens when you consume the first mango, the second, and so on? You are barely interested by this point. Why do you think this happens?
Ans.
Each additional mango consumed gives less satisfaction than the one before it. This is known as the principle of diminishing marginal utility, which explains why the willingness to pay for a good falls as more of it is consumed.
Let's Explore — Notebook Demand and Future Price Expectations (Demand)(2 questions)
1
Create your own demand schedule for buying notebooks at different prices. At what price would you buy the most? At what price would you stop buying altogether? What could be the reason behind your choices?
Ans.
(Sample) At a low price, such as ₹10 per notebook, I would buy the most; at a high price, such as ₹100, I would stop buying altogether. This is because a lower price increases affordability and willingness to buy, in line with the Law of Demand. (Sample answer — students should prepare their own demand schedule with at least 3–4 price levels.)
2
Ask your family members if they postponed or advanced buying any product because of future expectations of changes in price.
Ans.
(Sample) My family postponed buying a television, expecting festive-season discounts, and advanced buying cooking oil before an anticipated price rise, showing how future price expectations affect present demand. (Sample answer — students should record an actual instance shared by their family.)
Let's Explore — Determinants of Supply (Supply)(1 questions)
1
What happens to the supply of a product in case of a change in the cost of inputs, discovery of an alternate input, depletion of resources, change in weather, disaster, etc.? Discuss in class using examples of diverse goods and services.
Ans.
A rise in the cost of inputs, such as fertiliser or fuel, reduces supply, while the discovery of a cheaper alternate input increases supply by lowering production costs. Depletion of resources, adverse weather, and natural disasters reduce supply, as seen when floods or droughts damage standing crops and lower farm output.
Let's Analyse — Plotting Demand and Supply (Market Equilibrium)(1 questions)
1
Hard
Using data from Table 9.3, plot the demand and supply curve at the three prices, i.e., ₹40, ₹100, and ₹150. Identify and mark excess demand and supply on the graph. Think about how equilibrium could be reached in these scenarios.
Ans.
At ₹40, quantity demanded (38 kg) exceeds quantity supplied (6 kg), showing excess demand. At ₹150, quantity supplied (43 kg) exceeds quantity demanded (8 kg), showing excess supply. At ₹100, quantity demanded equals quantity supplied (12 kg each), which is the equilibrium point. Prices at ₹40 and ₹150 would move towards ₹100 as buyers and sellers adjust, until demand equals supply.
Think About It — Dynamic Markets and Sustainability(2 questions)
1
Can you think of another real-life example (other than hotels) where prices change frequently? Explain why the prices keep changing.
Ans.
(Sample) Airline ticket prices change frequently based on seat availability, travel dates, and booking demand, since airlines constantly adjust fares to match changing demand and maximise revenue. (Sample answer — students may cite cab fares, event tickets, or online shopping deals as other valid examples.)
2
Hard
Should we focus only on short-term gains, or also think about long-term sustainability? How could this affect the market equilibrium?
Ans.
Focusing only on short-term gains, such as overfishing or overusing groundwater, depletes resources and reduces future supply, pushing prices higher later. Considering long-term sustainability keeps supply steady over time, leading to a more stable market equilibrium in the future.
Think About It — Government Price and Wage Fixing(1 questions)
1
Have you ever seen or heard of the government fixing prices or wages (for example, bus fares, medicines, or minimum wages)? Share an example and why you think it was done.
Ans.
(Sample) The government fixes the Minimum Support Price (MSP) for crops such as wheat and rice to ensure farmers earn a fair and stable income, protecting them from unpredictable market price fluctuations. (Sample answer — other valid examples include regulated bus fares or capped medicine prices.)
Let's Explore — Public Goods(1 questions)
1
Hard
From your surroundings, list two goods or services provided by the government (for example: roads, streetlights, parks, police, and so on). Choose one of the goods you listed and answer the following.
- a.Who does benefit from it?
- b.Why would it be difficult for a private company to provide this service on its own?
- c.Imagine the government stops providing this good or service, what problems might people in your area face?
Ans.
(Sample) Streetlights and public parks are two services provided by the government in my locality. Who does benefit from it? — All residents, pedestrians, and vehicle users benefit from streetlights, as they improve safety and visibility at night for everyone without exception. Why would it be difficult for a private company to provide this service on its own? — A private company cannot easily charge individual users, since streetlights cannot exclude non-paying users, making it unprofitable for private provision. Imagine the government stops providing this good or service, what problems might people in your area face? — Without streetlights, roads would become unsafe at night, increasing the risk of accidents, theft, and other crimes in the locality. (Sample answer — students should list goods/services actually available in their own surroundings.)
Let's Recall — Democracy and Market Intervention(2 questions)
1
Hard
According to you, how should a democratic government decide when and how much it should intervene in markets to protect people’s welfare?
Ans.
A democratic government should intervene only when markets fail to serve public interest, such as during unfair pricing, monopoly, or under-provision of essential goods, while avoiding excessive regulation that discourages enterprise and innovation.
2
Whose voices should a democratic government consider while making such decisions — consumers, producers, workers, or others? Why?
Ans.
A democratic government should consider the voices of consumers, producers, and workers together, since all are affected by market decisions, and balancing their interests ensures fair, inclusive, and sustainable economic policies.
Section 10: Questions and Activities (End of Chapter)(12 questions)
1
Hard
An increase in income always leads to a rise in demand for goods. Defend or refute, giving reasons for the same.
Ans.
This statement is not always true. While rising income increases demand for normal goods, demand for inferior goods, such as cheaper substitutes, may actually fall as consumers shift towards higher-quality alternatives.
2
If petrol prices double, what happens to:
- a.Demand for diesel cars
- b.Demand for electric cars
- c.Demand for car accessories
- d.Demand for public transport
Ans.
Demand for diesel cars — Demand is likely to rise, as diesel becomes a relatively cheaper substitute fuel option compared to petrol. Demand for electric cars — Demand is likely to rise, since electric vehicles become a more economical substitute for petrol-run vehicles. Demand for car accessories — Demand may fall slightly, as costlier petrol discourages new car purchases, reducing demand for complementary accessories. Demand for public transport — Demand is likely to rise, as travelling by personal petrol vehicles becomes costlier for commuters.
3
A farmer traditionally irrigates fields manually (labour-intensive). He installs drip irrigation (a technology upgrade) that reduces water use by 40 per cent and increases yield by 30 per cent. How does this affect:
- a.His cost of production
- b.His willingness to supply at different prices
- c.The overall market supply if many farmers adopt this technology
Ans.
His cost of production — His cost of production falls, since drip irrigation reduces water use and related input costs while increasing output. His willingness to supply at different prices — His willingness to supply increases at every price level, as lower costs and higher yield raise his profitability. The overall market supply if many farmers adopt this technology — The overall market supply increases, and the supply curve shifts to the right, as most farmers can now produce more at every given price.
4
Hard
During online festival sales, the prices of many products are very low. Use the concept of demand and supply to explain why the sellers sell at such a low price. What happens to the equilibrium when the price is lowered? Does this benefit only consumers or sellers as well? Explain.
Ans.
Sellers lower prices to clear excess inventory and attract more buyers, which increases the quantity demanded. This shifts the market to a lower price and higher quantity equilibrium. It benefits consumers through savings on purchases and benefits sellers through higher sales volumes and reduced unsold stock.
5
Suppose the government sets a maximum sale price for an essential vaccine below the market-driven price. What is likely to happen? Choose from the options below and elucidate your point.
Ans.
(b) Shortage. When the price is fixed below the equilibrium level, quantity demanded exceeds quantity supplied, since producers are unwilling to supply as much at the lower, less profitable price, creating a shortage.
6
The government levies higher taxes on products such as tobacco and alcohol to promote healthier choices among citizens. Can you find out other goods where price controls have been set in place? What are the reasons for the same?
Ans.
(Sample) The government fixes price ceilings on essential medicines and LPG cylinders to keep them affordable, and sets Minimum Support Prices for crops like wheat and rice to protect farmers’ incomes from market price fluctuations.
7
Hard
Can excessive government regulation hurt markets? Explain with suitable examples.
Ans.
Yes, excessive regulation can hurt markets. For example, price ceilings set too low discourage farmers from producing wheat, while excessive licensing requirements raise compliance costs, discouraging small entrepreneurs from starting or expanding businesses.
8
In the table below, different prices of guava are given — think and write how much guava you will buy at each price, ask the same to three friends, fill the table, and make individual and total demand graphs.
Ans.
(Sample) As the price of guava falls from ₹100/kg to ₹20/kg, the quantity each person is willing to buy rises, following the Law of Demand. Adding up all individual quantities at each price and plotting them gives the individual demand curves and the market (total) demand curve, both sloping downward from left to right. (Activity-based question — students should collect actual responses from three friends and draw the graphs themselves.)
9
Visit the nearby vegetable market and try to find answers to the following questions.
- a.Who decides the prices of different vegetables in the vegetable market?
- b.Sometimes the prices of a few vegetables is too high, and sometimes too low. Why is this?
- c.The price of tomatoes is high in the morning and eventually gets lower by the evening. Have you ever noticed this? Comment.
Ans.
Who decides the prices of different vegetables in the vegetable market? — Prices are decided through negotiation between buyers and sellers, based on daily supply, demand, transportation cost, and competition among sellers, rather than by any single authority. Sometimes the prices of a few vegetables is too high, and sometimes too low. Why is this? — Prices rise when supply is low due to poor harvest, seasonal shortage, or high demand, and fall when supply is abundant or demand is weak. The price of tomatoes is high in the morning and eventually gets lower by the evening. Have you ever noticed this? Comment. — Tomato prices are often higher in the morning when fresh stock and demand are high, and fall in the evening as sellers try to clear perishable stock before it spoils, raising supply relative to demand.
10
Categorise the following combination of goods into substitute goods and complementary goods.
Ans.
Movie ticket in the cinema hall and popcorn — Complementary goods. Eraser and pencil — Complementary goods. Laptop and computer — Substitute goods. Air Conditioner and cooler — Substitute goods. Notebook and pen — Complementary goods. Apple and banana — Substitute goods. Mobile and earphones — Complementary goods.
11
Hard
Fig. 9.8 shows the demand curve DD' and supply curve SS'. Based on the figure, answer the following questions.
- a.What does point E represent in this market?
- b.What is the equilibrium price and equilibrium quantity at point E?
- c.Point A lies on DD'. Point B lies on SS'. What do the points A and B indicate about demand and supply? What does the gap between A and B represent?
- d.Point F lies on DD'. Point C lies on SS'. What do the points F and C indicate about demand and supply? What does the gap between C and F represent?
- e.If the price stays at the lower dashed line, what could happen next in a free market?
Ans.
What does point E represent in this market? — Point E represents the market equilibrium, the point where the demand curve and supply curve intersect, and quantity demanded equals quantity supplied. What is the equilibrium price and equilibrium quantity at point E? — Based on the graph, the equilibrium price is approximately ₹250 and the equilibrium quantity is approximately 30 kg. Point A lies on DD'. Point B lies on SS'. What do the points A and B indicate about demand and supply? What does the gap between A and B represent? — At this higher price, point A shows a lower quantity demanded while point B shows a higher quantity supplied. The gap between A and B represents excess supply (a surplus) at that price. Point F lies on DD'. Point C lies on SS'. What do the points F and C indicate about demand and supply? What does the gap between C and F represent? — At this lower price, point F shows a higher quantity demanded while point C shows a lower quantity supplied. The gap between C and F represents excess demand (a shortage) at that price. If the price stays at the lower dashed line, what could happen next in a free market? — The resulting shortage would cause buyers to compete for the limited quantity available, bidding the price upward until it moves back toward the equilibrium price at point E.
12
Hard
Draw a market equilibrium graph using the given demand schedule (Price ₹10, 20, 30, 40, 50; corresponding Qd 5, 10, 15, 20, 25 kg and Qs 25, 20, 15, 10, 5 kg).
- a.Plot the demand and supply curve using the above data
- b.Identify the equilibrium price and quantity
- c.Observe the above data and analyse what happens if the price is set at ₹20 or ₹40
Ans.
Plot the demand and supply curve using the above data — The demand curve slopes downward and the supply curve slopes upward; when plotted together, they intersect at one common point. Identify the equilibrium price and quantity — The two curves intersect at ₹30, where quantity demanded equals quantity supplied at 15 kg. Hence, the equilibrium price is ₹30 and the equilibrium quantity is 15 kg. Observe the above data and analyse what happens if the price is set at ₹20 or ₹40 — At ₹20, quantity demanded (10 kg) is less than quantity supplied (20 kg), creating an excess supply of 10 kg. At ₹40, quantity demanded (20 kg) exceeds quantity supplied (10 kg), creating an excess demand of 10 kg. In both cases, prices would adjust back towards the equilibrium price of ₹30.