NCERT Solutions-Chapter 12-Understanding Markets-Class 7 Social Science

 Exercise Question Answers Chapter 12-Understanding Markets(Theme E-Economic Life Around Us) Subject Social Science Class 7

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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?

Answer:

• A market is a place where buyers and sellers meet to exchange goods or services.

• One key feature is price negotiation, especially in informal or local markets.

• Markets have variety of goods, ranging from food to clothes and electronics.

• They often involve interpersonal interactions and bargaining.

• Payment methods can vary: cash, UPI, or card.

• In my recent visit to a vegetable market, I saw vendors calling out prices, people comparing items, and many buyers using mobile UPI for quick payments.

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..

Answer:

“Prosperity emanates from the market that develops when people need goods and services that they can’t create themselves.”

• The quote emphasizes that markets grow from human needs and mutual dependency.

• It reflects how economic prosperity is linked to market development.

• People rely on others for goods/services they can’t produce—like clothes, medicines, etc.

• This idea matches the chapter’s content on producer-consumer connections.

• It supports the role of trade and markets in sustaining livelihoods.

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 likely to be his response?

Answer:

• The farmer would try to increase guava production in the next season.

• They will assess market demand and may grow more guavas to meet it.

• The profit motive may encourage investment in better seeds or tools.

• Farmers may explore new markets or middlemen for higher sales.

• Overproduction may also occur if too many farmers plant the same crop.

4. Match the following types of markets with their characteristics:

S. No.	Markets	Criteria
1	Physical market	Goods and services flow outside the nation’s boundaries
2	Online market	Deals in bulk quantities
3	Domestic market	Serves the final consumers with goods and services
4	International market	Requires physical presence of buyers and seller
5	Wholesale market	Buyers and sellers meet virtually and can transact at any time
6	Retail market	Lies within the boundaries of a nation

 Answer:

S.No.	Market Type	Correct Characteristic
1	Physical market	Requires physical presence of buyers and seller
2	Online market	Buyers and sellers meet virtually and can transact any time
3	Domestic market	Lies within the boundaries of a nation
4	International market	Goods and services flow outside the nation’s boundaries
5	Wholesale market	Deals in bulk quantities
6	Retail market	Serves final consumers with goods and services

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?

Answer:

• The product may be rare or exclusive (e.g., luxury watches, diamonds).

• High production cost leads to higher prices.

• The brand value or prestige increases price (e.g., Apple phones).

• There may be limited supply or seasonal availability.

• Prices remain high due to niche demand or import costs.

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 then goes to a super bazaar nearby. They buy vegetables in the super bazaar where they pay ₹40 / kg for the beans that is neatly packed in a plastic bag. What are the reasons that the family does this? Are there factors that affect buying and selling which are not directly connected to price?

Answer:

• The supermarket may offer better quality and hygiene.

• Items are neatly packed, giving a sense of trust.

• They may feel more comfortable and less pressured in a supermarket.

• The ambience and reputation influence buying decisions.

• Some people may not trust small vendors, even if they are cheaper.

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 that the tomatoes are not wasted, and the farmers are also not at a loss?

Answer:

• There may be too much supply and low market demand.

• No proper cold storage or transportation support.

• Prices fall too low, making sales unprofitable.

• Wholesalers may refuse to buy large quantities.

• Government or NGOs can help by buying produce at fair price, or promoting food processing units.

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?

Answer:

• Students set up stalls with crafts, games, or food.

• They display prices, sometimes offer discounts or allow small bargaining.

• They learn to talk to customers and manage small-scale business.

• Handling money and giving change builds practical skills.

• It creates a fun and educational experience involving teamwork and negotiation.

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?

Answer:

• Products without logos may be unregulated or from small/local brands.

• Absence of marks like FSSAI, ISI, AGMARK may raise concerns on quality.

• Branded items usually have certification; unbranded ones may not.

• Consumers might prefer certified goods for safety and trust.

• Sellers may skip certification to cut costs, especially in informal markets.

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?

Answer:

• Name of product (e.g., Herbal Fresh Soap).

• Ingredients list (e.g., neem, aloe vera, coconut oil).

• Date of manufacture & expiry.

• Net weight and MRP.

• If applicable, certification marks (like AYUSH or ISI).

• Optional: Fragrance, usage instructions, and contact info of manufacturer.

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