Role of economics concepts in real life

SUPPLY:

The goods offered by the producers into the market for sale based upon their willingness and ability at various prices

Examples:

1             1)we all are aware of Colgate company. It always releases different products in toothpaste at various prices in to the market is nothing but supply

               2)Vehicles which released by automobile company at different prices

            Factors that affect the supply of a product are: -

a. Decrease in cost of production

b. Price

c. Natural conditions

d. Transport

e. Government policies

PEOPLE FACE TRADEOFF

The term trade-off means to get one thing given up on the another thing. In our real life if we want to buy one product we will sacrifice the another product then we will face trade off. Making decisions requires trade-off one thing against another thing

Examples:

             1) We regularly go for a shopping you have liked two shirts very much but you want to purchase one shirt. you have purchased one shirt u didn’t purchase another shirt for                              getting one thing u have given up the another thing here.

2                2)One person went to a Yamaha showroom he wants to purchase a bike. He liked both FZ and R15 but he decided to buy fz he has given up the r15 bike

OPPORTUNITY COST:

  Opportunity cost is next best alternative among choices .it is also known as alternative cost in other words opportunity cost what you gave up to get one thing.

EXAMPLES:

1)     I went to a showroom to purchase led tv there are two company products Samsung and Sony led tv both costs same price Rs.50000/-.I have selected to buy a Sony led tv it is high hd quality where Samsung is normal hd quality here the opportunity cost is Samsung tv

2)     I went to a cinepolis to watch a movie there are two movies sanju and avengers both movie tickets costs 250 but I decided to go to avengers’ movie because of graphics and fights here the opportunity cost is sanju movie

PRODUCER SURPLUS:

Producer surplus is difference between the price producer willing to sell and at what price actually he sold

Examples:

1   
)     1) I am a producer of spectacles. I want sell each spectacle for Rs 1500/- but by seeing customer I have increased the price to 2500 after bargaining customer purchased for 2000 the difference Rs.500 is producer surplus to me as a producer  

2    2) I am a real-estate business person I want to sell a 1 acre land for 50,00,000/- I called the customers for bidding .There three customers named  A B C posted their bids. Customer A made a bid for Rs.4500000, B for 4900000, C for 5100000.i have sold land to customer C for Rs.5100000.the difference amount Rs 100000 is producer surplus to me

MARGINAL UTILITY:

Marginal utility is additional satisfaction consumer gets afters consuming the one or more additional units of goods or service

Examples:

1   
)     1) I went to a restaurant I have order a chocolate pastry after having that I feel somewhere        my stomach is filled. Again I ordered a one more pastry after having I fell that my                 stomach   is satisfied and I feel that I had enough stuff .The extra satisfaction which I have got after having second pastry is marginal utility

2    2)  I went to a movie on release date I went to morning show I liked the movie 70 % again I went for first show at that time I liked the movie very much i.e 100% the additional 30% satisfaction I got by watching the movie is marginal utility