LAW OF DIMINISHING MARGINAL UTILITY:
My friend is found of chocolates I brought so many
chocolates for her than Consuming one chocolate she satisfied her desire. After
second chocolate bar is consumed, the satisfaction of eating that second bar
gave her less that the satisfaction gained from eating the first, when she had
third chocolate consumed the satisfaction was even less.
Rational people think at marginal
Rational people systematically and purposefully do the best
they can to achieve their objectives given the opportunities they have.
Let me explain it with example jio 448 and Airtel 449 offer,
Jio have benefits compared to Airtel people
get marginal benefit by taking the jio prime membership than compared to Airtel.
Opportunity cost:
The loss of other alternatives when one alternative is
chosen.
At the ice cream parlour, you have to choose between
butterscotch or strawberry. When you choose butterscotch, the opportunity cost
in the enjoyment of the strawberry.
Mobility (determinant of supply)
Big
bazar has so many branches because people are more interested in going to big
bazar so they started mobilizing themselves by opening many branches at
different places.
Law of demand:
When my brother income got raised by 10% the consumption of
some goods got increased in our home. These are non-price determinants of
demand income rise in a person’s income will lead to an increase in demand, a
fall in income will lead to a decrease in demand for normal goods.
No comments:
Post a Comment