Notes with worthy tutorials
Income elasticity of demand : A persons demand for a good may change with hisher change in income. The income elasticity of demand is the ratio of percentage change quantity purchased per time to the percentage change in income. Thus, Here, em = Income elasticity of demand m = initial income Q = … Read more
Price Elasticity of Demand : Price elasticity of demand measures the quantitative response of demand to a change in price. This is the ratio of percentage change in demand to the percentage change in price. So the price elasticity of demand is, Here, ep = price elasticity of demand ΔQ = change in quantity … Read more
Elasticity : In economics, elasticity is the ratio of the percentage change in one variable to the percentage change in another variable. Elasticity is a popular tool among empiricists because it is independent of units and thus simplifies the analysis. … Elasticity of Demand : The demand of a commodity depends … Read more
Market Demand For a Commodity : The market demand for a commodity means the total demand for a commodity made by all the individuals in the market. The market demand for a commodity gives the alternative amounts of a commodity demanded per time period, at various alternative prices, by all the individuals in the market. … Read more
Shift in Demand Curve : Shift in demand curve means the change in demand curve. This change will have to be for the change in ceteris paribus. That is when the price of a commodity remains constant and the other things which can affect the demand of the commodity changes, a shift can be found … Read more
Law of Negatively Sloped Demand Curve: First, obtain the demand schedule; the formula is, Qdx = f(Px) Considering, an individual demand function for a commodity X is given by, Qdx =8 – Px cet.par. Here, Qdx is the quantity demanded and Px is the price … Read more
Obtaining Demand Schedule: To obtain the demand schedule the formula is, Qdx = f(Px) Considering, an individual demand function for a commodity X is given by, Qdx =8 – Px cet.par. Here, Qdx is the quantity demanded and Px is the price of X commodity. Now substituting various prices of X in … Read more
Demand: The desire for a commodity of an individual or a group will be called their demand when they are able to pay for that commodity. That is demand is desire with account to pay. In Benham’s words, “Demand for anything at a given price is the amount of it which will be bought per … Read more
Opportunity Cost: Life is full of choices. Because resources are scarce, we must always consider how to spend our limited income or time. In a world of scarcity choosing one thing means giving up something else. If there is no increase in productive resources, increasing production of a first good has to entail decreasing production … Read more
Production Possibility Frontier (PPF) : In economics, a production possibility frontier (PPF) is a graph that shows the different rates of production of two goods that an individual or group can efficiently produce with limited productive resources. The PPF shows the maximum obtainable amount of one commodity for any given amount of another commodity or … Read more