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Theory Of Consumer Behaviour
Question
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Distinguish between increase in demand and extension of demand.

Answer

Both reflect rise in quantity demanded but causes are different. Increase in demand is at the same price (i.e., due to change in factors other than the price) but extension of demand is caused by fall in price of the commodity.

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Some More Questions From Theory Of Consumer Behaviour Chapter

What is meant by marginal rate of substitution (MRS)?

 Why is MRS always diminishing?

When does a consumer attain equilibrium according to indifference curve approach?

Give meaning of demand.

 Name two determinants of demand.

List the factors that cause changes in demand.

What is law of demand?

What is demand schedule?

Why does demand curve slope downwards?

Differentiate between substitute and complementary goods.