Microeconomics

Chapter – 2: Elasticity of Demand – III (Proofs)

Q.3. (i) Prove that the elasticity of a downward sloping straight-line demand curve varies from infinity (left ( infty right )) at the price- axis to zero at the quantity-axis.  (ii) Comparing two straight line demand curves of the same slope, the one farther from the origin is less elastic at each price than the …

Chapter – 1: Concept of Demand – III (Movement & Shift)

Q3. Distinguish between change in quantity demanded and change in demand. or Differentiate between movement along a demand curve and shift in a demand curve. Ans. Change in quantity demanded means change in demand that takes place due to a change in price. Movement along a demand curve refers to a change in quantity demanded …

Utility and Utility Function

Utility, in Economics, is the capacity of a commodity to satisfy the wants of an economic agent. It may depend on the quantity or quality of a commodity, that is, an increase or decrease in quantity or improvement or deterioration in quality may increase or decrease utility derived from a commodity. We commonly assume that …

Chapter – 2: Elasticity of Demand – II (Numericals)

Q.2. Attempt the following: (a) Price of a commodity falls from ₹4 to ₹3 per unit. As result total expenditure on it rise from ₹200 to ₹300. Find out price elasticity of demand by percentage method. (b) As a result of a 5 per cent fall in the price of a good, its demand rises …

Chapter – 2: Elasticity of Demand – I

Q.1. (a) Give the meaning of, or differentiate between price elasticity, income elasticity and cross elasticity of demand. Draw appropriate diagrams. (b) Explain the relationship between price elasticity of demand, income elasticity of demand and elasticity of substitution. Ans. (a) Price Elasticity of Demand. Price elasticity of demand measures the degree of responsiveness of quantity … Chapter – 1: Concept of Demand – I

Q1. Define demand. Distinguish between individual demand and market demand function for a product. Or What are the determinants of the quantity demanded of a product? How will you derive the market demand curve? Or Give the relationship between individual and market demand functions. Ans. – Demand for a commodity is defined as the quantity …