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How the indifference curve and budget line apparatus are used to derive a consumer's demand curve?
Wiki User
∙ 13y ago
Indifference curve: series of curve reflecting the preference structure of the individual.
Budget constraint: the material resource constraint the individual faces in choices.
The demand curve, being inherently designated as rational, seeks to maximise utility. Thus, in a Walrasian equilibrium, the consumer construct his demand curve at the points where his contract curve equals to his budget constraint (or, in mathematical terms, when the constraint and optimal indifferences are tangent to one another). These tangencies construct a curve which is the individual's demand function.
Wiki User
∙ 13y ago
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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
Consumers create a demand for something by?
Consumers create a demand for something by?
What are the factors that affect demand forecasting?
- consumers may not be aware of actual demand in future - answers from consumers are not real - consumer response are biased - plan of consumers change with time
What is demand and quantity of demand?
Demand is a function that defines how much of a certain good are the consumers willing to purchase at a given price.Quantity of demand is the quantity of a certain good the consumers are willing to purchase at a given price, as defined by the function of demand.
Indifference curve analysis is not much in use because it only tells us that demand curve has a negative slope except when they don't .?
indifference curve analysis is not much in use because it only tells us that demand curve has a negative slope except when they don't ....
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
Derivation of demand curve using the indifference curve approach?
The derivation of an individual consumer demand curve can be done using the indifference curve approach. This is done by preparing the demand schedule of a consumer from the price consumption curve.
Consumers create a demand for something by?
Consumers create a demand for something by?
Law of demand and supply?
Consumers is the law of supply and demand.
What are the factors that affect demand forecasting?
- consumers may not be aware of actual demand in future - answers from consumers are not real - consumer response are biased - plan of consumers change with time
What is demand and quantity of demand?
Demand is a function that defines how much of a certain good are the consumers willing to purchase at a given price.Quantity of demand is the quantity of a certain good the consumers are willing to purchase at a given price, as defined by the function of demand.
Indifference curve analysis is not much in use because it only tells us that demand curve has a negative slope except when they don't .?
indifference curve analysis is not much in use because it only tells us that demand curve has a negative slope except when they don't ....
Is individual demand curve and market demand curve same for identical consumers?
NO
For consumers when there is the goods they want to buy?
demand
What is the relationship between the demand-side and the federal budget deficit?
Describe the relationship between demand-side economics and the federal budget deficit.
What is the eight demand states in marketing?
1. Negative demand: consumers dislike the product and may even pay a price to avoid it. 2. Nonexistent demand: consumers may be unaware or uninterested in the product. 3. Latent demand: consumers may share a strong need that cannot be satisfied by an existing product. 4. Declining demand: consumers begin to buy the product less frequently or not at all. 5. Irregular demand: consumer purchases vary on a seasonal, monthly, weekly, daily, or even hourly basis. 6. Full demand: consumers are adequately buying all products put into the marketplace. 7. Overfull demand: more consumers would like to buy the product than can be satisfied. 8. Unwholesome demand: consumers may be attracted to products that have undesirable social consequences. E.g. Cigarettes are harmful to society but attract more and more consumers to use.
