Theory of consumers behaviour - commit
Enthalpy of neutralization of is the heat change taking place when 1 gram equivalent of an acid or base is neutralized by 1 gram equivalent of base or acid in a dilute solution. Heat of neutralization of strong acid-strong base is always constant, i. This is because strong acids, strong bases and salt that they form are all completely ionized in dilute aqueous solutions. Thus the reaction between any strong acid and strong base for example in the above case may be written as :. All rights reserved. Classscience » Economics. Classcommerce » Economics. Classhumanities » Economics. Theory of Consumer Behaviour. Share with your friends. theory of consumers behaviour.Those who purchase and use goods for their satisfaction are known as consumers.
They want satisfying power of a commodity is known as a utility. A Consumption Bundle: Normally, a consumer purchases numerous goods and services.
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However, for simplicity, let us assume that the consumer purchases only two goods namely good 1 and good 2. Consumption bundle can be defined as the theory of consumers behaviour of quantities of two goods that a consumer can purchase with his limited income. The consumption bundle of a consumer depends on the income of the consumer and the prices of the respective goods he wish to purchase from the market. It means that the consumer can purchase only those consumption bundles which are less than or equal to his level of income and the prices of goods he can afford to pay. Article source Budget Set: It includes all bundles that are on or below the budget line.
The consumer opt the most appropriate consumption bundle from the budget set. Which bundle he would choose depends upon his tastes and theory of consumers behaviour. A consumer ranks two consumption bundles as per his preference and then may choose one bundle or may consumes indifferent between the bundles. If a consumer prefers to have a bundle which has more goods compared to other bundles then it is known as monotonic preference.
The concept of indifference curve was initially developed by Edge Worth. Indifference curve is a graphical representation of locus of points of two consumer goods which gives him the same amount of satisfaction. If two consumption bundles give the equal amount of satisfaction to the theory of consumers behaviour, we can say that he is indifferent among the consumption bundles. The group of indifference curves available to the consumer is known as indifference map. At the point E the budget line is tangent with indifference curve. It shows the consumer equilibrium. Demand is the desire for a commodity supported by ability to pay and willingness to pay. Demand for a commodity is determined by various factors such as. When other things remaining constant, an increase in price leads to fall in demand and decrease in price leads to rise in demand.
This is known as law of demand. A decrease in demand due to rise in price is known as contraction of demand. A fall in demand due to change in other factors theory of consumers behaviour known as decrease in demand. The law of demand explains only about the direction of relationship between price and quantity of commodity demanded. It does not explain how much change happens in demand due to a unit change in price. Price elasticity is a measure used to explain the extent of change in quantity demanded as a result of change this web page price.
It measures the degree of responsiveness of change in quantity demanded as a result of change in price. Save my name, email, and website in this browser for the next time I comment.
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Preferences of click Consumer The consumer opt the most appropriate consumption bundle from the budget set. Monotonic Preferences If a consumer prefers to have a bundle which has more goods compared to other bundles then it is known as monotonic preference. Properties of Indifference Curve The following are some of the major properties of indifference curve. Indifference curve slopes downward from left to right.
Kerala Plus Two Microeconomics Notes Chapter 2 Theory of Consumer Behaviour
Indifference curves are convex to the origin. Indifference curves never intersect each other. Higher indifference curves show higher levels of satisfaction. The slope of the indifference curve is negative. Indifference curves are not necessarily parallel to each other.]
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