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Explain the consumer equilibrium with the help of indifference curve?
Explain the consumer equilibrium with the help of indifference curve?
What is Consumer equilibrium under ordinal utility approach?
Consumer equilibrium is the point where consumer attains highest level of satisfaction. There are two conditions of equilibrium under ordinal approach 1- Necessary Condition: 'Budget line is tangent to the highest possible indifference curve.' 2- Sufficient Condition: 'At equilibrium, Indifference curve must be convex to the origin' Thus, at equilibrium , Px/Py (absolute slope of Budget line) = dy/dx (absolute slope of Indifference Curve) (In simple words, it'd determination of consumer's equilibrium with the help of Indifference curve.)
Income consumption curve?
income consumption curve is the collection of points of the consumer's equilibrium resulting from varying income.....
Where is the consumer surplus located on a graph depicting market equilibrium?
Consumer surplus is located above the market price and below the demand curve on a graph depicting market equilibrium.
What is a price consumption line?
A price consumption lines show a consumer's demand for a good or service after price changes. It is draw through the equilibrium of an indifference curve and the budget line
Explain the consumer equilibrium with the help of indifference curve?
Explain the consumer equilibrium with the help of indifference curve?
What is Consumer equilibrium under ordinal utility approach?
Consumer equilibrium is the point where consumer attains highest level of satisfaction. There are two conditions of equilibrium under ordinal approach 1- Necessary Condition: 'Budget line is tangent to the highest possible indifference curve.' 2- Sufficient Condition: 'At equilibrium, Indifference curve must be convex to the origin' Thus, at equilibrium , Px/Py (absolute slope of Budget line) = dy/dx (absolute slope of Indifference Curve) (In simple words, it'd determination of consumer's equilibrium with the help of Indifference curve.)
Income consumption curve?
income consumption curve is the collection of points of the consumer's equilibrium resulting from varying income.....
Where is the consumer surplus located on a graph depicting market equilibrium?
Consumer surplus is located above the market price and below the demand curve on a graph depicting market equilibrium.
What is a Price line?
A price consumption lines show a consumer's demand for a good or service after price changes. It is draw through the equilibrium of an indifference curve and the budget line
What is a price consumption line?
A price consumption lines show a consumer's demand for a good or service after price changes. It is draw through the equilibrium of an indifference curve and the budget line
Because demand curve and supply curve always change market never attain equilibrium does this imply the concept of equilibrium is not useful?
Well it means that equilibrium is basically a dynamic process and it adjusts to the new situation where basic variables of the market has registered changes and the new endowment point becomes the need of the situation.
How do shifts in supply and demand curves impact market equilibrium, and can you provide examples of such shifts?
Shifts in supply and demand curves impact market equilibrium by changing the equilibrium price and quantity. When the supply curve shifts to the left or the demand curve shifts to the right, the equilibrium price increases and the equilibrium quantity decreases. Conversely, when the supply curve shifts to the right or the demand curve shifts to the left, the equilibrium price decreases and the equilibrium quantity increases. Examples of shifts in supply and demand curves impacting market equilibrium include: Increase in consumer income leading to a shift in the demand curve to the right, resulting in higher equilibrium price and quantity for luxury goods. Technological advancements leading to a shift in the supply curve to the right, resulting in lower equilibrium price and higher equilibrium quantity for electronic devices. Government regulations causing a shift in the supply curve to the left, resulting in higher equilibrium price and lower equilibrium quantity for certain products like cigarettes.
Is demand needed in equilibrium?
Yes. Equilibrium is created at the intersection of the Demand curve and Supply Curve. Equilibrium can be shifted if the Demand curve increases or decreases, and the same happens when the Supply curve increases or decreases. Without demand, you would just have a Supply curve.
What is the relationship between indifference curve and budget constraint?
The tangency point of Indifference curve and budget line shows the Marginal Rate of Substitution between X and Y commodities. Consumer's equilibrium is achieved at that point.
What is shown by the intersection of supply curve and the demand curve?
the equilibrium price of a good or service
What is the equilibrium of a firm?
The equilibrium of a firm depends with the elasticity of a demand curve.
