Question

What will happen to equilibrium price and quantity in the market if tata group annoces bonus for employees

Answer 1

Answer:

The equilibrium price and quantity will increase.

Explanation:

If the Tata group provides a bonus to its employees, it will increase the income of those workers. This increase in income will cause their purchasing power to increase.  

As a result, the demand for goods and services will increase. This increase in demand for goods and services will cause the demand curve to move to the right.  

This rightward shift in the demand curve would cause both the equilibrium quantity as well as the equilibrium price to increase.

Answer 2

When Tata group announces a bonus for the people then the income level of the people increases and their buying power goes up. There will be more people buying products and services. More quantity will be sold and there will higher equilibrium price.

Explanation:

• When the Tata group provides a bonus to its employees, it will increase the income of those workers.  

• There will be more demand and supply of goods in the market since the increase in income will cause their purchasing power to increase.  

• This increase in demand for goods and services will affect the equilibrium price and quantity which increases.  

• If the demand for good falls then there will be a decrease in the equilibrium and the quantity.

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