Income elasticity of demand

1.What does a supply curve illustrate? What would make the supply curve shift? Provide two examples from the market for orange juice where supply contracts (curve shifts left). The supply curve illustrates the how much the sellers are willing to supply a good at different prices, as the price goes up the supply will increase and as the price goes down the supply will decrease. The supply curve shifts because of changes in costs or technology innovations, these changes can shift the supply curve…

ISOQUANTS DEFINITION Isoquant (derived from quantity and the Greek word iso, meaning equal) is a contour line joining the set of all points at which a quantity of output is produced while varying quantities of two and/or more inputs. An indifference curve mapping helps us to arrive at the utility-maximization of consumers, the isoquant mapping deals with the cost-minimization of producers. Isoquants are ideally drawn alongside isocost curves in capital-labour graphs, showing the technological…

Research question: How does the mass (grams[±0.1g]) on one side of a pulley affect the mass (grams), and create equilibrium? Hypothesis: If the differences in masses (grams{±0.1g}) on each side of the pulley increases, then the mass in the middle of the two pulleys will be required to increase, because they will have to balance out each other’s mass to establish equilibrium. If the mass (grams{±0.1g}) on a side of a pulley decreases, then the mass in the middle of the two pulleys will be…

Inelastic PED (price elasticity of demand, this measures the responsiveness after a change in price), inelastic PED means that the demand (the quantity consumers are able and willing to pay for a product at any given time) is not very responsive to change in price, which means the percentage change in demand is less than the percentage change in price. (∆%Qd /∆%P is <1) Turing pharmaceuticals bought legal rights to a drug by the name Daraprim, they then increased its cost by 5000%, stating…

's economy has been growing substantially in the past years. International trades and businesses have been increasing rapidly, causing business and leisure trips to increase as well. Eventually, prices of airline tickets increase substantially as demand rises. Some passengers are dissatisfied by the high price of airline tickets. Hence, in order to reduce their cost of traveling, some passengers would consider using hidden-city ticketing. (GAO 2001) For this reason, the price variation of…

2.4 MPA theories 2.4.1 Yerkes-Dodson law In a nutshell, the Yerkes-Dodson law operates in the following manner: when arousal increases from low to moderate levels in an individual, the individual’s performance quality will be greater. If the arousal levels reach a point that is to high, performance quality decreases. Figure 1: Hebbian’s Version of the Yerkes-Dodson Curve (Dodson & Yerkes 2014) Optimum arousal is an adaptive anxiety which facilitates better performance (Lehmann et al.…

results in a small change in quantity demanded. If we consider the injections have an inelastic demand, according to demand theory; we can say that the percentage change in quantity is less than the percentage change in price. If the producers increase the price, total revenue will increase because the slightly higher price per injection sold will more than offset the decrease in injections sold. When the demand is inelastic, increasing the price to keep the revenues steady doesn’t seem like a…

Question 1 Define ad explain using formulae, the term price elasticity of demand. Answer 1 Demand is price elastic if the change in price leads to a even larger proportion of change in demand; therefore price elasticity of demand will therefore be greater than 1. This is because goods that are inelastic have all these qualities or features They are expensive/luxury or costly goods, e.g. or latest smartphones or designer clothes. Goods with many substitutes or similar products have a…

Economies of scale refer to economic efficiencies as an outcome of conducting a process on a mass scale. Scale effects come to picture due to the presence of fixed and variable costs in the production process. In other words, ‘Economies of Scale’ or ‘Increasing Returns to Scale’, is a term used by economists to refer to the situation in which the cost of producing an additional unit of output (i.e., the marginal cost) of a product (i.e. a good or service) declines as the quantum of output (i.e.,…

I. Gain the attention of the audience: By a show of hands, how many of you are familiar with stevia? This type of sweetener is naturally two-hundred times sweeter than table sugar. II. Establish credibility: According to the U.S. Department of Agriculture (1989). Americans consume one hundred and fifty-six pounds on artificial sweeteners each year on a per capital basis. Because you might not know what is too little or too much. III. Adapt the presentation to yourself- the speaker: So, what’s…