Written by V R Sunday, 07 November 2010 06:57
- Considering the disadvantages of localization of industry, it is sometimes though to establish different types of industries in one particular in one particular area.This is decentralization of industry.Decentralization is opposite to localization.
- Advantages-Even if the product demand of one or two firms declines,mass unemployment will never result,Economic dependence of one part of the country over another will not be much,All the types of workers will be developed and be available in a particular area.
Written by V R Sunday, 07 November 2010 06:47
- The first factor affecting prices is a demand and the second factor that affects price is supply.
- By the supply of a commodity is meant the quantity that is called forth into the market-over a particular period of time by a certain price.
- Just as demand is not the same as need,and implies effective demand or demand at a price so it is with supply.
- The supply of a commodity does not comprise the entire stock of it in existence,but only that amount drawn into the market by the price ruling at the time.
- Supply demands upon scarcity,just as demand depends on usefulness.
Written by V R Sunday, 07 November 2010 06:34
- It can be seen from demand curve that the demand for the good is responsive to a fall in price, however there are difference in the degree of responsiveness of different goods to price changes.
- Elasticity of demand describes the degree of responsiveness of the demand for a good,to a fall in its price.strictly speaking,elasticity of demand refers to all the way in which the demand for a good responses to change in its price,whether a rise or a fall.
- The elasticity of demand in a market is a great or small-according as the amount demanded increases much or little for a given fall in price, and diminishes much or little for a given rise in price.
- Elasticity of demand =Proportionate change in amount demanded/Proportionate change in price.
Written by V R Sunday, 07 November 2010 06:25
- The greater the amount to be sold,the smaller must be the price at which it is offered in order that it may find purchasers;or,in other words the amount of goods demanded increases with a fall in price and diminishes with a rise in price.There will not be any uniform relation between the fall in price and the increase of demand.
- The law of demand is clear from the Demand Schedule table given above which shows that the lower the price of tea per kg,the greater is the quantity demanded per month.
- The law of demand is based upon the law of diminishing utility.
- The law of demand holds goods when population,income of customers,price of alternate goods,taste of consumers,etc do not change.
Written by V R Sunday, 07 November 2010 06:20
- The price of anything is the rate at which it can be exchanged for anything else.
- A commodity has a price because on the one hand,it is useful,and on the other hand,it is scarce in relation to the uses to which people want to put it.
- When a price of any good is determined in the market for that good,it is because usefulness and scarcity express themselves concretely in the demand of buyers on the one hand and supply by sellers on the other.Price is determined by the interaction of two sets of influences,those of demand and supply.
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