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2. Theory of Demand and Supply

Demand and supply are foundational concepts in economics that describe how markets function. Demand refers to the quantity of a commodity that consumers are willing to purchase at various prices, while supply refers to how much sellers are willing to offer. The chapter explores the laws governing demand and supply, factors that influence them, and the concepts of elasticity in both demand and supply.

Sections

  • 2

    Theory Of Demand And Supply

    This section introduces the fundamental concepts of Demand and Supply in economics, explaining their definitions, types, laws, and influencing factors.

    Learning Practice

  • 2.1

    Introduction

    This section introduces the crucial concepts of Demand and Supply that are foundational to market economics.

    Learning Practice

  • 2.2

    Demand

    This section covers the concept of demand in economics, detailing its meaning, types, and the factors that affect it.

    Learning Practice

  • 2.2.1

    Meaning Of Demand

    Demand is the willingness and ability of consumers to purchase a quantity of a good at a specific price and time.

    Learning Practice

  • 2.2.2

    Types Of Demand

    This section distinguishes between individual demand and market demand as two fundamental types of demand in economics.

    Learning Practice

  • 2.2.3

    Law Of Demand

    The Law of Demand states that, ceteris paribus, when the price of a commodity decreases, its demand increases, and conversely, when the price increases, demand decreases.

    Learning Practice

  • 2.2.4

    Demand Schedule And Curve

    The demand schedule and curve illustrate the relationship between price and quantity demanded.

    Learning

  • 2.2.5

    Factors Affecting Demand

    Various factors influence consumer demand for goods and services, affecting how much consumers are willing and able to buy.

    Learning Practice

  • 2.3

    Elasticity Of Demand

    Elasticity of demand measures how quantity demanded changes in response to price changes.

    Learning Practice

  • 2.3.1

    Meaning

    Elasticity of demand measures how responsive the quantity demanded of a commodity is to changes in its price.

    Learning Practice

  • 2.3.2

    Types

    This section outlines the various types of elasticity of demand, including elastic and inelastic demand.

    Learning Practice

  • 2.4

    Supply

    This section introduces the concept of supply, highlighting how price affects the quantity supplied.

    Learning Practice

  • 2.4.1

    Meaning Of Supply

    Supply represents the quantity of a commodity that sellers are willing to offer for sale at a specific price over a certain time period.

    Learning Practice

  • 2.4.2

    Law Of Supply

    The Law of Supply states that, all else being constant, an increase in the price of a commodity leads to an increase in its supply, while a decrease in price leads to a decrease in supply.

    Learning Practice

  • 2.4.3

    Supply Schedule And Curve

    The section discusses the Supply Schedule and Supply Curve, which illustrate the relationship between the price of a commodity and the quantity supplied.

    Learning Practice

  • 2.4.4

    Factors Affecting Supply

    This section explores the various factors that influence the supply of commodities in the market.

    Learning Practice

  • 2.5

    Elasticity Of Supply

    This section defines elasticity of supply, explaining how it measures the responsiveness of the amount supplied to changes in price.

    Learning Practice

  • 2.5.1

    Meaning

    This section defines the concept of elasticity of supply in economics, focusing on its meaning and significance.

    Learning Practice

  • 2.5.2

    Types

    This section discusses the types of elasticity of supply, specifically elastic and inelastic supply, highlighting their definitions and implications.

    Learning Practice

References

e2 (1).pdf

Class Notes

Memorization

What we have learnt

  • Demand refers to the willin...
  • The law of demand states th...
  • Supply is defined as the qu...

Final Test

Revision Tests

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