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RECENT DEVELOPMENT OF DEMAND THEORY: The basic theory of consumer behaviour discussed in the previous unit can be extended in many directions, and can be applied to cover opt
In an updated GDP that contains household production, how would the purchase of a car or appliance for household use be treated? A car or appliance would be treated as a househ
Joe Brown’s dairy operates in a perfectly competitive marketplace. Joe’s machinery costs $500 per day and is the only fixed input. His variable costs are comprised of the wages pai
AGRICULTURAL GROWTH AND PRODUCTIVITY TRENDS: Despite a steady decline in the share of agriculture in the Gross Domestic Product (GDP) of India, this sector continues to remain
What does Keynesian consumption function say about tax cuts
Consider the following insurance market. There are two states of the world, B and G, and two types of consumers, H and L, who have probabilities pH =0.5 and pL =0.25 (high and low
The law of supply is that producers will supply more the higher the price of the commodity. The supply curve is an upward sloping function showing a direct relationship among pric
Do the laws of economics still work today? use the case discussed in class to answer this question or any other examples) (ii) Provide examples of three factors that can shift the
Uses and Habit Forming Commodity -price elasticity of demand: The number of possible uses : A commodity has high price elasticity of demand (or elastic demand) if it can be p
Q. Describe Consumer Price Index? Consumer Price Index:Consumer price index (CPI) is a measure of overall price level paid by consumers for various services and goods they purc
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