Question

Will the total expenditure change in the opposite direction or same direction of price change if % change in quantity is (i) greater than (ii) less than % change in price of the commodity?

Solution

Solution not provided.

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Hint, (i) Total expenditure will change in the opposite direction of price change if % change in quantity > % change in price and (ii) in the same direction of price change if % change in quantity < % change in price.

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?

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Theory Of Consumer Behaviour

Will the total expenditure change in the opposite direction or same direction of price change if % change in quantity is (i) greater than (ii) less than % change in price of the commodity?

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.

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