Question

32. "Price rise is beneficial to as well as a hindrance in economic development." explain
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Answer 1

Price rise is beneficial to as well as a hindrance in economic development, because -

• If the prices increase for a particular substance,then the profit margins of the manufacturing company will technically increase if they are able to maintain the same amount of production cost which was before the price rise.

• But,on the same time,the price rise will surely decrease the market demand for that substance because the customers always look for a good quality product in a cheap price. If price rises for a certain product the consumers will definitely look for a cheaper alternative before paying that increased price. In this way,the market demand gets affected in a negative way.

Answer 2

Answer:

If the price increase for a particular commodity then the profit margins of the producting industry will increase if they are able to maintain the same amount of production cost which was before the price rise. ... If price rises for a commodity consumers will look for alternative choices.

Explanation: