+91-8076753736 support@wiredfaculty.com

Sponsor Area

Theory Of Consumer Behaviour

Question

Wired Faculty App

Price elasticity of demand of a good is -3. 80 units of this good are bought at a price of र 5 per unit. How many units will be bought at a price of र 4 per unit? Calculate.

Solution

negative 3 equals fraction numerator increment straight q over denominator negative ? left parenthesis equals 4 minus 5 right parenthesis end fraction cross times 5 over 80 or space space space space space increment straight q equals fraction numerator 3 cross times 80 over denominator 5 end fraction equals 48

At price of र 4 per unit, 128 (= 80 + 48) units will be bought.

Some More Questions From Theory Of Consumer Behaviour Chapter

What is demand function? State a consumer's demand function.

Distinguish between 'Change in demand' and 'Change in quantity demanded of a commodity'.

Starting from an initial situation of consumer's equilibrium, suppose that marginal utility of a rupee increases. Will it increase or decrease the quantity demanded of the product?

What are two approaches to attain the state of consumer's equilibrium?

Define indifference curve.

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.

Mock Test Series

Mock Test Series

NCERT Sample Papers

Entrance Exams Preparation