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Showing posts with the label Difference between change in quantity demand and change in demand

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Difference between change in quantity demand and change in demand

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- March 25, 2021

Learning Contents: Difference between Change in Quantity demand and Change in demand.

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SHIFTS & ROTATIONS IN PRODUCTION POSSIBILITY CURVE

- January 11, 2021

Learning Contents: Shifts in PPC Rotations in PPC Change in Production Possibility Curve (Shifting/Rotation) The change in the Production Possibility curve can be of two types: Shift in PPC: PPC will shift when there is a change in productive capacity (resources or technology) with respect to both the goods. Rotation of PPC: PPC will rotate when there is a change in productive capacity (resources or technology) with respect to only one good. Shifts in PPC: The shift in PPC can either be rightward or backward. These shifts bring about a change in the production of both goods in an economy. The shifts in PPC are of two types: Rightward shift in PPC: Rightward shift in PPC occurs when the resources are increased or technology is improved for the production of both goods that means we can produce more of both the goods. Accordingly, PPC shifts to the right from Initial PPC (AB) to Final PPC (CD). Re

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Income Elasticity: Luxury Goods, Necessity Goods, and Inferior Goods.

- July 16, 2021

Learning Contents: · Understanding Income Elasticity with respect of luxury goods, necessity goods and inferior goods. The demand for a commodity not only depends on the price of a commodity but also the income level of the consumer. It is a general understanding that a consumer usually prefers to spend more when his income rises and less when his income falls. Sometimes, we might also experience a fall in the demand of certain goods and services even when income rises. Therefore, income elasticity varies with respect to different types of goods and services. The income elasticity measures the percentage change in quantity demanded as a result of percentage change in the income of the consumer. The formula of income elasticity of demand is, The income elasticity measures the demand’s sensitivity or responsiveness to the change in income. In simple words, it measures to what extent demand changes as a result o

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CONCEPT OF TOTAL UTILITY AND MARGINAL UTILITY

- January 15, 2021

Learning Contents: · Concept of Total Utility · Concept of Marginal Utility & its types · Relationship between Total and Marginal Utility Total Utility (TU) If the utility is cardinal and measurable, the total utility is defined as the sum total of utility (satisfaction) derived from the consumption of all the units of a commodity. In mathematical terms, Total utility is the direct function of the number of units of a commodity. In simple words, more of the units of a commodity is consumed; more will be the total utility. It can be written as, TU x =f(x) TU= Total utility of a commodity ‘x’ f=Function x= quantity of ‘x’commodity consumed. Again, the total utility can also be expressed with the help of marginal utility. It is the summation of all the marginal utilities , i.e. TU OR TU= MU 1 + MU 2+ MU 3 +MU 4……… +M

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New Problems Based on Price elasticity of Demand

- August 20, 2021

Hi Learner, Thanks for writing your query! Please find the solved answers of your questions. We are always happy to help the true learners. Pls. Let us know if we can help you further! Sending wishes to you 😊 Work hard.... Work Better.... Keep learning.... Keep Improving.... Questions for Practice: 1. Suppose the price of a commodity falls from ₹6 to ₹4 per unit and due to this quantity demanded of the commodity increases from 80 units to 120 units. Find out the price elasticity of demand Solution: Following information is given: Q = 80 units Q 1 = 120 units ΔQ =Q 1 -Q =120-80 = 40 P = ₹6 P 1 = ₹4 ΔP = P 1 -P = 4-6 = -2 E d =? Note : (-) negative sign is prefixed to the formula because price and demand are inversely related. Doing this would bring the value of elasticity of demand

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CONSUMER’S PREFERENCES AND INDIFFERENCE MAP

- February 01, 2021

Learning Contents: · Understanding Consumer preferences and Indifference curve. · Understanding Indifference Map. Introduction: The concept of the indifference map is based upon the concept of consumer preferences. So, it is important to first understand the concept of consumer preferences. Consumer’s Preferences: Preferences indicate individual tastes, likings, etc. that determine the amount of pleasure, happiness people get from the consumption of the goods and services and measured by the utility of various bundles or combinations of goods. It allows the consumers to rank these bundles of goods according to the levels of utility it provides them. Note that preferences are independent of income and prices. The ability to purchase goods does not determine a consumer’s likes or dislikes. One can have a preference for Rolex watches over Titan but only have the financial means to wear a titan

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Introduction to Elasticity of Demand

- April 28, 2021

Learning Contents: · Concept of Demand and Elasticity of Demand · Various Concepts of Elasticity of Demand · Concept of Elastic and Inelastic Demand Concept of Demand and Elasticity of Demand The Law of demand explains that, keeping other factors constant, demand for a commodity is inversely related to its price. In other words, if the price for a commodity rises, the quantity demand decreases. On the other hand, if price falls, quantity demand increases. Therefore, the concept of demand focuses on the direction of change i.e. how demand changes due to a change in price. In simple words, it explains that demand either increases or decreases as a result of a change in price but it overlooks an important aspect i.e. degree of change in demand i.e. How much or to what extent demand changes due to change in price? The degree of change is explained by the elasticity of demand. Therefore,

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SOLVED MULTIPLE CHOICE QUESTIONS BASED ON PRODUCTION POSSIBILITY CURVE

- January 14, 2021

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LAW OF DIMINISHING MARGINAL UTILITY

- January 19, 2021

Learning Contents: Introduction to Law of Diminishing Marginal utility/ Gossen’s First Law of Consumption. Assumptions of Law of Diminishing Marginal Utility. The simple experiment of understanding LDMU Introduction H.H.Gossen, a german economist was the first who found this law in Economics in 1854. Therefore, Jevons called this law “Gossen’s First Law of Consumption”. But credit goes to Marshall because he perfected this law on the basis of cardinal analysis. This law is based on the characteristics of human wants, i.e., wants are satiable or might get full or satisfied. The law of diminishing marginal utility says that as more and more units of a commodity are consumed, the satisfaction received from the consumption of every additional commodity will decline. In simple words, we say if we have more of a thing, then we will receive less and less satisfaction from

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Change in supply/ Shifts in supply curve.

- September 02, 2021

Learning Contents: · Increase in supply · Decrease in supply Introduction As studied in previous post related to the determinants of supply that states, it is not only the price which cause change the supply for the commodity but in the real world there also exist other factors such as price of related goods, objective of the firm, government policies, technology changes, etc. that affect the supply for the commodity. Change in supply indicates that supply for the commodity changes due to change in other factors keeping the price of the commodity constant. In other words, when supply for the commodity increases or decreases due to change in other factors or determinants of supply, other than the own price of the commodity is called as ‘ shifts in supply curve’. Shifts in supply curve are also known as change in supply. Such shifts in supply curve may be either increase in sup

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Measuring Income Elasticity of Demand: Proportionate Method

- June 24, 2021

Learning Contents: · Introduction to Income Elasticity of Demand · Measuring Income Elasticity using Proportionate Method Introduction Demand for the commodity is not only influenced by the price. Besides price, other factors such as the price of related goods, the income of the consumer, taste and preferences and expectations about the future price, etc. also influence the demand for the commodity. Therefore, the concept of elasticity of demand can be defined as a degree of change in demand for a commodity as a result of the change in its own price of the commodity, change in the price of related goods i.e. substitute goods and complementary goods, change in income of the consumer, etc. In this post, we will understand how income elasticity of demand is calculated using proportionate method. Income Elasticity of Demand (Proportionate or Percentage Method) Income elasticity of demand tells u

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SOLVED MULTIPLE CHOICE QUESTIONS BASED ON PRODUCTION POSSIBILITY CURVE2
& DEMAND1
ATTAINABLE & UNATTAINABLE OUTPUT1
BASIC CONCEPT OF ORDINAL UTILITY AND INDIFFRENCE CURVE1
Budget Set and Budget Line1
CONCEPT OF COMPLEMENTARY GOODS1
CONCEPT OF TOTAL UTILITY AND MARGINAL UTILITY1
CONSUMER’S EQUILIBRIUM USING INDIFFERENCE CURVE ANALYSIS1
CONSUMER’S EQUILIBRIUM- ONE COMMODITY CASE1
CONSUMER’S PREFERENCES AND INDIFFRENCE MAP1

Change in Demand / Shifts in Demand curve1
Change in supply/ Shifts in supply curve.1
Cross Price effects: Effect of change in price of substitute good on the demand of other good.1
Cross Price effects: Effect of change in price of complementary good on the demand of other good.1
DESIRES1
DIFFERENT SHAPES OF PRODUCTION POSSIBILITY CURVE1
DOWNWARD SLOPE AND CONVEX SHAPE OF INDIFFRENCE CURVE1
Degrees of Income Elasticity of Demand1
Degrees of Price Elasticity of Demand1
Degrees of cross price elasticity of demand1
Demand Schedule and Demand Curve1
Determinants of Supply/ Factors affecting Supply1
Difference between Contraction of Demand and Decrease in Demand1
Difference between Contraction of Supply and Decrease in Supply1
Difference between Extension of Demand and Increase in Demand1
Difference between Extension of Supply and Increase in Supply.1
Difference between Price Elasticity and Income Elasticity of Demand1
Difference between change in quantity demand and change in demand1
ECONOMY AND ITS CENTRAL PROBLEMS1
EXCEPTIONS TO THE LAW OF DEMAND1
EXCEPTIONS TO THE LAW OF DIMINISHING MARGINAL UTILITY1
Effect of change in Consumer’s Income on the demand of the normal and inferior goods1
Effect of change in Input price on the supply curve of the firm.1
Effect of change in Taste and Preferences on the demand for a good.1
Effect of change in Technology on the supply curve of the firm.1
Factors affecting Demand/Demand Function/Determinants of Demand1
Factors affecting Price Elasticity of Demand1
Geometric or Point method of price elasticity of demand1
INDIFFERENCE CURVE OF SUBSTITUTE GOODS1
INTRODUCTION TO MACROECONOMICS1
INTRODUCTION TO MICRO ECONOMICS1
INTRODUCTION TO UTILITY1
Income Elasticity: Luxury Goods1
Introduction to Elasticity of Demand1
Introduction to Supply1
LAW OF DIMINISHING MARGINAL UTILITY1
LAW OF EQUI-MARGINAL UTILITY OR CONSUMER’S EQUILIBRIUM: TWO COMMODITY CASE1
MICROECONOMICS AND MACROECONOMICS: THE DIFFERENCE1
MONOTONIC PREFERENCES OF THE CONSUMER1
Measuring Elasticity : Arc Elasticity of Demand1
Measuring Income Elasticity of Demand: Proportionate Method1
Measuring Income Elasticity- Normal Goods and Inferior Goods1
Measuring Price Elasticity of Demand- Proportionate or Percentage Method1
Measuring Price Elasticity of Demand- Total Expenditure Method1
NEEDS1
Necessity Goods1
New Problems Based on Price elasticity of Demand1
OPPORTUNITY COST AND MARGINAL OPPORTUNITY COST1
POSITIVE AND NORMATIVE ECONOMICS1
POTENTIAL AND ACTUAL LEVEL OF OUTPUT1
PPC ASSUMPTIONS1
PPC PROPERTIES1
PRICE ELASTICTY AND SLOPE OF DEMAND CURVE1
Price Elasticity of Demand and Total Revenue1
SCHEDULE AND DIAGRAM1
SHIFTS & ROTATIONS IN PRODUCTION POSSIBILITY CURVE1
SHIFTS AND ROTATIONS IN BUDGET LINE1
SLOPE OF A DEMAND CURVE1
SLOPE OF A LINE1
SLOPE OF BUDGET LINE1
Solved Questions- Price Elasticity of Demand using Total Expenditure Approach1
Solved Questions- Percentage Method of Price Elasticity of Demand1
Solved Questions: Percentage Method of Price Elasticity of Demand1
Supply Schedule and Supply Curve1
TWO IMPORTANT PROPERTIES OF INDIFFERENCE CURVE1
UNDERSTANDING SCARCITY AND ECONOMICS1
WANTS1
WHY DOES THE DEMAND CURVE SLOPES DOWNWARD?1
What cause movements along a Demand Curve?1
What cause movements along the supply curve?1
and Inferior Goods.1

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