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Durability of the Commodity:With some commodities, we require one at a time and they are used for a very long time before they get spoilt. Examples of such goods are cars, televisions, furnitures, building, clothes etc. They tend to hve low elasticity of demand (inelastic demand) because when the price of a durable commodity changes, consumers will continue to use what the have.Even when the price of such a commodity falls, it is new consumers who will mostly buy them.
Luxuries and NecessitiesLuxuries are things we can always do away with hence they tend to have elastic demand. Necessities are difficult to dispense with and they tend to have inelastic demand.
Location of industry and localization of industry: Location of industry tries to answer the key economic question "where to produce". It involves deciding on the area that an
if the price of labour is 2000 per hour and the price of capital is 1000 per hour.is there an efficiency point of production.
Calculate the cross-price elasticity of demand between computers and printers, where a 10 percent decrease in the price of computers results in a 15 percent increase in the quantit
A firm in a perfectly competitive product market takes the price of the product as given. Similarly, a firm in a perfectly competitive factor market takes the price of the factor
Provide an economic explanation of what you have shown in your diagram above. Iceland was a small open economy with perfect capital mobility. Consequently, the equilibrium domesti
Explain how Monetarist economics views the role of markets and government intervention in fighting business cycles. Monetarist economics believes that the government should fol
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The marginal rate of substitution (MRS) quantifies the quantity of one good a consumer will sacrifice to get more of the other good. – It is calculated by the slope of the indif
what do you understand by production posibility curve?
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