Author: admin
-
What is Demand Function and Demand Schedule?
Demand refers to the quantity of a commodity the customer is willing and capable to purchase, at any given time and at each possible price. The above definition highlights essential components of demand: (i) Quantity of the commodity (ii) Willingness to buy (iii) Price of the commodity (iv) Period of time. Demand for a commodity…
-
Difference between Individual Demand and Market Demand
The demand for a commodity can be with respect to an individual and an entire market. However, Individual Demand is different from Market Demand. Individual Demand The quantity of a commodity a consumer is willing and able to purchase at every possible price during a specific time period is known as Individual Demand. There are…
-
Individual and Market Demand
In economics, demand is the quantity of a good or service that a consumer is willing and able to purchase at different price levels available during a given time period. Although the demand is a desire of a consumer to purchase a commodity, it is not the same as the desire. Desire is just a wish of…
-
Theory and Determinants of Demand
In economics, demand is the quantity of a good or service that a consumer is willing and able to purchase at different price levels available during a given time period. Although the demand is the desire of a consumer to purchase a commodity, it is not the same as desire. Desire is just a wish of a…
-
Consumer’s Equilibrium by Indifference Curve Analysis
What is Consumer’s Equilibrium? The term equilibrium is used frequently in economic analysis. It is a state of rest or a position of no change, which under a situation provides the maximum gain. A consumer is said to be in equilibrium when he has derived maximum satisfaction and does not want to change his consumption level. Hence, Consumer’s…
-
Shift in Budget Line
While drawing a budget line, it is assumed that the income of the consumer and the price of the commodities is constant. Therefore, there will be a shift in the budget line when there is either a Change in the Income of the Consumer or a Change in the Price of the Commodity. What is…
-
Budget Line
What is Budget Line? The term budget line refers to a graphical representation of all the potential combinations of two commodities that can be bought within a certain income and price, and all of these combinations provide the same satisfaction level. It comes with the condition that the cost of each combination must be less than or…
-
Indifference Curve
What is Indifference Curve ? A curve or a graphical representation of the combination of different goods providing the same satisfaction level to the consumer is known as Indifference Curve. One cannot put a numerical value on the level of satisfaction gained from the consumption of goods. However, they can tell their preference between two goods, i.e.,…
-
Consumer’s Equilibrium in case of Single and Two Commodity
What is Consumer’s Equilibrium? The term equilibrium is used frequently in economic analysis. It is a state of rest or a position of no change, which under a situation provides the maximum gain. A consumer is said to be in equilibrium when he has derived maximum satisfaction and does not want to change his consumption level. Hence, Consumer’s…
-
Law of Diminishing Marginal Utility (DMU)
What is Diminishing Marginal Utility (DMU)? According to the Law of Diminishing Marginal Utility (DMU), with the consumption of more and more units of a commodity, the utility obtained from each successive unit decreases. Most consumers spread their income among different varieties of goods when making choices. People prefer a variety of goods as consuming more…