Author: admin
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Law of Demand
What is the Law of Demand? The Law of Demand states that there is an inverse relationship between the price and quantity demanded of a commodity, keeping other factors constant or ceteris paribus. It is also known as the First Law of Purchase. There are several other factors besides the price of the given commodity that affect the…
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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…
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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…
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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…
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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…
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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…
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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…
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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…
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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.,…
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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…