With reference to "Ration Coupons", consider the following statements: 1. They are issued to consumers to limit the purchase of essential goods. 2. They are typically used when the government imposes a price floor. 3. They allow consumers to buy goods from fair price shops. Which of the statements given above is/are correct?

The correct option is 1 and 3 only. Explanation Rationing is a method used by governments to distribute essential goods when supply is limited or when prices are controlled. It involves restricting the quantity of a good that consumers are allowed to purchase to ensure equitable distribution and food security. Statement-wise Analysis: - Statement 1 is Correct: Ration coupons are issued to consumers to limit the purchase of essential goods. This ensures that scarce resources are distributed fairly among the population, preventing hoarding and ensuring that everyone has access to a minimum quantity of essentials. - Statement 2 is Incorrect: Rationing is typically employed when the government imposes a price ceiling (maximum price), not a price floor. A price ceiling set below the equilibrium price creates excess demand (shortage). To manage this shortage and prevent the goods from going only to those who can pay more or arrive first, the government uses ration coupons. A price floor (minimum price) typically leads to a surplus, which does not require rationing for consumers. - Statement 3 is Correct: In the context of the Public Distribution System (PDS), ration coupons (or ration cards) allow beneficiaries to purchase subsidized food grains and other essential commodities from designated outlets known as Fair Price Shops (FPS). Key Takeaway: Ration coupons are a non-price rationing mechanism used to manage shortages caused by price ceilings, ensuring essential goods are accessible to vulnerable sections through Fair Price Shops.

NCERT Class 12 Economics — Chapter 2: Market Equilibrium

mcqeasy

With reference to "Ration Coupons", consider the following statements:

They are issued to consumers to limit the purchase of essential goods.
They are typically used when the government imposes a price floor.
They allow consumers to buy goods from fair price shops.

Which of the statements given above is/are correct?

Official previous-year question

Verified 1 Aug 2026.

Options

A1 only
B2 only
C1, 2 and 3
D1 and 3 only

Did you get this right?

Solution

The correct option is 1 and 3 only.

Explanation

Rationing is a method used by governments to distribute essential goods when supply is limited or when prices are controlled. It involves restricting the quantity of a good that consumers are allowed to purchase to ensure equitable distribution and food security.

Statement-wise Analysis:

Statement 1 is Correct: Ration coupons are issued to consumers to limit the purchase of essential goods. This ensures that scarce resources are distributed fairly among the population, preventing hoarding and ensuring that everyone has access to a minimum quantity of essentials.
Statement 2 is Incorrect: Rationing is typically employed when the government imposes a price ceiling (maximum price), not a price floor. A price ceiling set below the equilibrium price creates excess demand (shortage). To manage this shortage and prevent the goods from going only to those who can pay more or arrive first, the government uses ration coupons. A price floor (minimum price) typically leads to a surplus, which does not require rationing for consumers.
Statement 3 is Correct: In the context of the Public Distribution System (PDS), ration coupons (or ration cards) allow beneficiaries to purchase subsidized food grains and other essential commodities from designated outlets known as Fair Price Shops (FPS).

Key Takeaway:

Ration coupons are a non-price rationing mechanism used to manage shortages caused by price ceilings, ensuring essential goods are accessible to vulnerable sections through Fair Price Shops.

Your note

More from Chapter 2: Market Equilibrium

With reference to the demand for a normal good, consider the following statements: 1. An increase in consumers' income leads to a rightward shift in the market demand curve. 2. An increase in the number of consumers leads to a rightward shift in the market demand curve. 3. A rightward shift in demand, with supply constant, leads to a decrease in equilibrium price. Which of the statements given above is/are correct?

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Consider the following statements regarding Market Equilibrium in a perfectly competitive market: 1. An equilibrium is defined as a situation where the plans of all consumers and firms in the market match. 2. In equilibrium, the aggregate quantity that all firms wish to sell equals the quantity that all consumers wish to buy. 3. If the market supply is greater than market demand at a specific price, the market is said to be in a state of excess demand. Which of the statements given above is/are correct?

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Consider the following statements regarding the determination of equilibrium with a fixed number of firms: 1. If the prevailing price is lower than the equilibrium price, there will be excess supply in the market. 2. In a situation of excess demand, the market price tends to increase. 3. As price rises, quantity demanded falls and quantity supplied increases, moving the market towards equilibrium. Which of the statements given above is/are correct?

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With reference to the Labour Market, consider the following statements: 1. Households are the suppliers of labour, while the demand for labour comes from firms. 2. The demand curve for labour by a profit-maximising firm is upward sloping. 3. The wage rate is determined at the intersection of the demand and supply curves of labour. Which of the statements given above is/are correct?

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Consider the following statements regarding the Marginal Revenue Product of Labour (MRPL): 1. It is the extra cost incurred for employing the last unit of labour. 2. It is calculated as the product of Marginal Revenue and Marginal Product of labour. 3. For a perfectly competitive firm, the Marginal Revenue Product of Labour is equal to the Value of Marginal Product of Labour. Which of the statements given above is/are correct?

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The correct option is 1 and 3 only.

Explanation

Statement-wise Analysis:

Statement 1 is Correct: Ration coupons are issued to consumers to limit the purchase of essential goods. This ensures that scarce resources are distributed fairly among the population, preventing hoarding and ensuring that everyone has access to a minimum quantity of essentials.
Statement 2 is Incorrect: Rationing is typically employed when the government imposes a price ceiling (maximum price), not a price floor. A price ceiling set below the equilibrium price creates excess demand (shortage). To manage this shortage and prevent the goods from going only to those who can pay more or arrive first, the government uses ration coupons. A price floor (minimum price) typically leads to a surplus, which does not require rationing for consumers.
Statement 3 is Correct: In the context of the Public Distribution System (PDS), ration coupons (or ration cards) allow beneficiaries to purchase subsidized food grains and other essential commodities from designated outlets known as Fair Price Shops (FPS).

Key Takeaway:

Ration coupons are a non-price rationing mechanism used to manage shortages caused by price ceilings, ensuring essential goods are accessible to vulnerable sections through Fair Price Shops.