a good consumers are willing and able to buy at each possible price during a given time period‚ other things constant. 2. The process to satisfy human wants/ needs/desires. * Want: having a strong desire for something * Need: lack of means of subsistence * Desire: an aspiration to acquire something 3. Demand: effective desire 4. Demand is that desire which backed by willingness and ability to buy a particular commodity. 5. Amount of the commodity which consumers are willing
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micro-economics Macro-economics is a younger branch of economics. Until the economic depression of 1930s economics was limited to what is currently Micro-economics. 1.1 Economic Models; Economic theory aims at the construction of models which describe the economic behavior of individual economic units;- consumers‚ firms‚ government agencies and their interactions hence creating the economic systems of a region‚ country or the world at large. An economic model is a simplified representation of the
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MICROECONOMICS 1 CONSUMER AND PRODUCER THEORY Lecturers: Marcel Kohler & Devi Tewari Rooms: Westville‚ J-Block‚ Room 367 & 362 Objectives: This course aims to develop students’ understanding and ability to explain real-world economic phenomena with the help of microeconomic principles. In this first module‚ we try to establish what drives the behaviour of consumers and producers in an economy by focussing on explanations of how they attempt to maximise their well-being‚ subject to certain constraints
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PROJECT REPORT ON MANAGERIAL ECONOMICS ANALYSIS OF TELECOM SECTOR IN INDIA INTRODUCTION India is the fourth largest telecom market in Asia after China‚ Japan and South Korea. The Indian telecom network is the eighth largest in the world and the second largest among emerging economies. At current levels‚ telecom intensiveness of Indian economy measured as the ratio of telecom revenues to GDP is 2.1 percent as compared with over 2.8 percent in developed economies. Indian telecom sector has
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evident fact (this time‚ a model of the way a consumer picks between two goods and what happens when the income and substitution effect go in opposite directions). This is a theoretical depiction; it captures the fundamental elements of consumer selection‚ predicting the way people will react to a change in price. THE INCOME AND SUBSTITUTION EFFECT According to The Law of Demand‚ when there is a change in the price of a good‚ the amount of the good consumers are able and willing to pay for changes
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Contents: 1.1 Meaning of Demand 1.2 Types of Demand 1.2.1 Individual and Market Demand 1.2.2 Autonomous and derived demand 1.2.3 Demand for durable and nondurable goods 1.2.4 Demand for firm’s product and industry product 1.2.5 Demand for consumers and producers goods 1.3 Determinants of Demand 1.4 Demand Function 1.5 Law of Demand 1.6 Demand Schedule 1.7 Demand Curve 1.8 Shift of Demand Curve v/s Movement along the demand curve 1.9 Effect of a Price Change 1.10 Elasticities of Demand 1
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LAW OF DIMINISHING MARGINAL UTILITY: The law of diminishing marginal utility describes a familiar and fundamental tendency of humanbehavior. The law of diminishing marginal utility states that: “As a consumer consumes more and more units of a specific commodity‚ the utility from the successiveunits goes on diminishing”. Mr. H. Gossen‚ a German economist‚ was first to explain this law in 1854. Alfred Marshal later onrestated this law in the following words: “The additional benefit which a person
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Elasticity is a measure of responsiveness. It shows us how much something changes when there is another change in one of the other variables that determines it. There are three elasticities of demand that we consider‚ price elasticity of demand (PED)‚ income elasticity of demand (YED) and cross elasticity of demand (XED). An important aspect of a product’s demand curve is how much the quantity demanded changes when price is changed. The economic measure of this response in the price elasticity
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Theory of Consumer Behavior: There are two main approaches to the of consumer behavior of demand. The first approach is the Marginal Utility or Cardinalist Approach. The second is the Ordinalist Approach. We discuss these two approaches separately. Cardinal Utility Analysis: Human wants are unlimited and they are of different intensity. The means at the disposal of a man are not only scarce but they have alternative uses. As a result of scarcity of recourses‚ the consumer cannot satisfy all
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efficient methods of production. For whom production should take place‚ production is allocated to those who can afford to pay. Consumers with no money cannot afford to by anything. There are mainly four factors of production . Land ‚ Labour ‚ Capital and Enterprise . Demand is the quantity that consumers are willing to buy at a given price. For example‚ a consumer may be willing to purchase 30 bags of potato chips in the next year if the price is $1 per bag‚ and may be willing to purchase
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