Introduction to microeconomics pdf download

13.09.2021 By Shannon Sessions

introduction to microeconomics pdf download

  • (PDF) Introductory Microeconomics | Dr. Paul Gachanja -
  • (PDF) Introduction to Microeconomics and Basic Concepts | Sagar ulak -
  • Introduction To Microeconomics | Pdf Books Download | Read Online Full
  • Incase of other commodities, rise of income beyond a certain level may lead introduction a fall in the quantity that the household demand. If the demand for a commodity falls as income rises, the good is called inferior good. The relation between income and quantity demanded can be shown by the use of Engels curve Income Y 0 Quantity demanded The curve download the relationship between income and demand, holding other factors constant.

    Engel curve for normal good slopes upwards, implying that as income rises, quantity demanded will also increase. Incase of inferior good, if Y increases Q decreases. In this case the Engels curve will slope downwards from left to right. Inferior good: relates to behavior of download demanded in relation to income. For example, in the beauty, would the taste of women have moved towards colored hair products such as pony tail or dyeing of hair.

    So the demand of such products would hike. If we hold other factors constant, we expect that an increase in advertisement expenditure will lead to an increase in demand. In this case quantity demanded increases. However, should they expect a fall in price in future they will buy less on the commodity now hoping to buy more in future after the price has fallen.

    In this case quantity demanded becomes less. The greater the microeconomics of population to satisfy, the greater the quantity consumers will be willing to demand. The fewer the consumer in the market, the less the quantity demanded will be. When we talk of composition of population we are talking of the sex proportion and age pdf.

    Certain commodities are manufactured for certain age group and sex. For instance, cosmetics are meant to be used by women, napkins by infants, shaving cream by men. So producers consider these factors before deciding how much to produce. Who shall be his market? This relationship between supply and price is called the law of supply.

    Supply schedule. Is defined as table showing quantities sellers are willing to put in the market at all microeconomics prices. This is shown below. It follows therefore that the supply curve for a normal good slopes upwards from left to right. The price of the commodity 2.

    Objectives of the firm 3. The technology used introduction. The cost of production incurred by producers 5. Taxation policies of the government 6. Weather condition 7. Subsidies 8. Price of competing pdf 9. Peace and stability The price of commodity At higher prices products are motivated to produce more thereby increasing the supply of the commodity under consideration.

    At lower prices less is supplied because producers see no reason why they should produce more because profitability will be negatively affected.

    Objective of the firm A firm can have various objectives. For example profit maximization; to maximize profit will require that more be supplied at higher price. For example, the supply of drugs; supply of drugs may rise depending on the prevailing situation even though prices are low. Technology used If better methods of production are used, we again expect output to be economically produced and so the supply of the commodity in question will increase.

    More can be supplied download some price because per unit cost of production would be lower than in the case where worse methods of production are used. Cost of production Increase in the cost of production will lower introduction supplied because producers will find it very expensive to increase output. However, with low cost of production more is likely to be supplied since the downloas will find easy and cheaper ways of producing more of the commodity in question.

    Taxation policies of the government The taxation microeconomics of the government also influence quantity supplied because if the government raises taxes, the cost of production goes up thereby reducing quantity supplied. Taxes make commodities be more expensive than competing products e. East African breweries has been urging the government to lower taxes on its products so that they could compete well against the south African Breweries products.

    Subsidies When the government fo the production of a given good, the supply of that good also increases because the cost of production is reduced by the subsidies given. Government may decide to incur part of the overall cost of production as downloaad way of imtroduction production of certain eownload which otherwise would have been very expensive to produce.

    Weather condition This commonly affects agricultural produce. When weather conditions are good, more is produced and hence supplied microeconomicz pdf versa. Such imported products have led to the collapse of many local industries.

    (PDF) Introductory Microeconomics | Dr. Paul Gachanja -

    For example, Mitumba second hand cloths whose prices are much lower than locally produced cloths have led to many textile industries closing down. And Security 9. Peace Development of infrastructure particularly transport and communication. A movement along a given supply curve is caused by pdf in the prices of the commodity. An upward movement is caused by an increase in price while a downward movement is caused by a fall in prices.

    A shift of download supply curve can either be to the right or left depending on the direction on which a change has taken place. A case at hand is the one of target workers. The supply curve of labor for target workers is a downward sloping curve showing that at higher wages rates, target workers are willing to work for less hours while at low wage rates target workers are willing to work are willing to work for more hours.

    Here At wage rate of sh. He shall be willing to work for 10 hours in order to get sh. When the wage rate is increased to sh. As the wage rate is increased further to sh. This gives us a downwards sloping supply curve of labor. The microeconomics the wage rate, the lesser will be the labor supplied and vice versa.

    Clearly distinguish between each of the following pairs of concepts. They carry 3 marks each pair. The question carries a total of 30 marks a Introduction economic system; Command economic system. Identify with reasons the demand and supply functions. Q Explain the negative intercept of the second function 2 above. It is a situation whereby quantity demanded Qd is equal to quantity supplied Qs i.

    introduction to microeconomics pdf download

    Excess demand!! That price is known as the equilibrium price. For example at p1 consumers will only be willing to buy 0Q1 from download market while sellers will by willing to supply 0Q2. In this case an excess supply equals to Q1Q2 will be created. Because of this excess supply, sellers will have to reduce the price in an attempt to encourage consumers to buy more.

    Prices will be reduced until p e is reached where quantity demanded equals quantity supplied. At p suppliers are willing to e 2 supply only Q because they consider p to be very low. On the other hand, pdf 3 2 will be willing to buy Q4 since very microeconomics of them can afford to pay p 2. In this case an excess demand shortage equal to Q3Q4 will be created.

    Because of shortages, consumers will compete among themselves for the little that is available and introduction of this competition, prices will be pushed upwards towards p e until eventually p e is reached. Stable equilibrium 2. Unstable equilibrium 3.

    Neutral equilibrium Stable equilibrium: if there is a force that disrupts the market equilibrium, then there would be adjustments that bring back to the initial equilibrium. This type of equilibrium is well explained in the previous section. Unstable equilibrium: this occurs when the deviation from the equilibrium position tend to push the market further away from the equilibrium conditions of unstable equilibrium occurs when the demand curve is positively sloped as in the case of a giffen good or when the supply curve is negatively sloped as in the case of labor supply.

    Neutral equilibrium:- this occurs when the initial equilibrium is disturbed and the forces of disturbances lead to a new equilibrium point. It may occur due to shift of either demand of supply curve, and through effects of taxes etc. Prices will continue to decline until a inttroduction equilibrium price p1 is realized.

    Conditions for kicroeconomics i Price restriction by government Government from time to time control prices of different commodities through maximum price policies and minimum price policies. Maximum ceiling price policy Here prices are set below equilibrium price because sometimes the equilibrium price might be regarded as being too high for the poor consumers to afford essential commodities.

    In an effort to protect poor consumers from exploitation, the government fixes a maximum ceiling price so that commodities that are regarded as essential can be within easy reach of the poor consumer.

    (PDF) Introduction to Microeconomics and Basic Concepts | Sagar ulak -

    This can be shown in the diagram below. As a result excess demand represented by Q1Q2 is created since at p1 supplier is willing to supply only Q1 while consumers are willing to buy Q2. However if the ceiling is above p esay p 2it will serve no purpose since the equilibrium pe Qe will still be maintained.

    At p 2 there will be excess supply and the producer would be better off reducing the price to p e to reduce wastage as a result of over production. Consequences of maximum price policy 1 Shortages can be created since demand will exceed pdf. Minimum floor price policies Here price are set above the equilibrium price, the reason being that the government might consider the equilibrium price to be a very low to motivate producers to continue production effectively.

    In order to encourage producers to produce more. Introduction government sets a minimum price. Minimum price are mainly found in the agricultural sector since the agricultural sector often suffers from price fluctuation. Below is a diagram which illustrates the working of introduction price policies. That is, owing to unfavorable climatic condition, supposing the producer microeconomicx to meet his targeted production of S P and instead he realizes only S A.

    Because of this excess demand down,oad the prices microeconomics move upwards. The consumers introductin be willing to pay a price p1 for S A units of output. This is shown as point V p1Q1 introduction the demand curve. However, this situation of disequilibrium may not be permanent.

    Once conditions improve, equilibrium may be attained. That would be in download long run. This could be because of inferior technology that could not allow production to take place on time to avoid shortage. Another reason could be imperfect knowledge about the market conditions. If consumers could have perfect knowledge on alternative sources of product such shortage could not pdf. How disequilibrium concept is applied Pdf disequilibrium concept can be applied on the cob- Web model.

    In our previous discussion, we said that one cause of disequilibrium is lagged download. The cobweb model assumes that producers output plans are fulfilled but with a time lag. That is, if a producer is a farmer, he cannot within the short-run increase his output just because the market is offering very good prices. This is so because of microeconomics nature of the products.

    The time between planting and harvesting is long enough risk and uncertainty to prevail. However demand depends on the prevailing prices in the market. Just like we have convergent fluctuation we can also have divergent fluctuation. In other words, the fluctuation tends to run away from equilibrium prices.

    Such a situation is known as divergent situation in that it diverges from the equilibrium price. Such a situation is known as a divergent situation in that it diverges from the equilibrium price. It has also been introductkon by some economists a situation of unstable equilibrium. It assumes that products former are irrational and hence base their production decision on the previous prices without thinking of price changes but this is rather unrealistic because in reality farmers always think about changes in prices in the future.

    The theory also assumes that all the quantity produced is sold in the market but this is also unrealistic because in the true sense some agricultural products are assumed for subsistence needs while microeconomics are stored waiting for sale in the future when prices are considered high.

    It is thus clear from the previous discussion that the elasticity of demand depends not only on the ratio of price to quantity demanded, but dosnload on the slope of the demand curve. The 1. Point elasticity Point elasticity is the proportionate change in quantity demanded resulting from a proportionate change in price at a particular point along the microfconomics curve.

    When calculating download elasticity, it is assumed jicroeconomics the slope of the demand function is known. Q is original quantity demanded. Income elasticity for a few commodities is known as inferior goods. Where the commodity id a basic necessity, the demand is not very responsive to change in income.

    Basic necessities like food are usually bought in fairly constant amount and on regular basis. Sales of such goods increase rapidly with increase in income. For example, the demand for good product depends on the demand for pork, mutton and fish etc.

    This is true of complementary products e. Cross elasticity of demand can either be positive or negative. If price ontroduction butter increases, the price of its pdf margarine held constant, the quantity demanded of margarines would increase. Solution Take first derivative of commodity Y with respect to all other products.

    Availabity of close substitutes-The higher the degree of the closeness of the substitutes, the greater the elasticity of demand of the good or service. For instance, coffee and tea may be considered as close substitute for each other. Therefore, 1 percent increase in price of say coffee, would lead to more than proportionate decline in quantity demanded of coffee.

    Nature fownload a commodity-Demand for luxury goods e. On the other hand, consumption of introduction e. Proportion of income which consumers spend on a particular commodity-If proportion of income spent on a commodity is large, its demand will be more elastic, and vice versa.

    A classic example of such jicroeconomics is salt, which claims a very small proportion of income whereas clothes, and other durable consumer goods claim a large proportion of income. Range of uses of a commodity- The wider the range of uses download a productthe higher the elasticity of demand. As the price of a multi-use commodity decreases, people extend their consumption to its other uses, thereby increasing the demand.

    For instance, milk can be taken as it is, it may be converted into cheese, ghee and butter. The demand for milk will therefore be highly elastic. Habit: some goods are microeconomics because of habit e. In this case their demand is said to inelastic. Elasticity of supply. On the other hand, if a big change in price brings about a small change in quantity supplied, then we say that supply is inelastic.

    Contents Contents iii List of Tables xiii List of Figures xv Preface xxiii 1 Introduction 1 The rôle of microeconomic principles 1. 1. Introduction to Course and Economics Lecture Notes 1. Economics Defined - Economics is the study of the ALLOCATION of SCARCE resources to meet UNLIMITED human wants. a. Microeconomics - is concerned with decision-making by individual economic agents such as firms and consumers. (Subject matter of this course) Size: 2MB. Sep 15,  · An Introduction to Gender and Wellbeing in Microeconomics. Download or Read online An Introduction to Gender and Wellbeing in Microeconomics full in PDF, ePub and kindle. This book written by Nicky Pouw and published by Routledge which was released on 01 September with total pages Author: Saul Estrin.

    Availability of factors of productivity this can be looked at as the ease with which factors of production could be shifted downlload one use to another. It can also be looked at as the number of available resources. When factors of production are available, supply will highly be elastic and vice versa.

    Suppliers will be able to meet demand in good times. Excess capacity of unsold stock Buffer-stock if there exist a lot of stock, incase prices increase, supplier would be able to respond very fast by increasing supply.

    Introduction To Microeconomics | Pdf Books Download | Read Online Full

    In such a case supply is said to be highly elastic. Time factor This refers to the time it takes to produce and supply a product in the market. In the short run, supply of most items that take a long time to produce is inelastic. Download or read online Microeconomics written by Justin Leroux,Nicolas Introducion, published by Unknown which was released on Get Nicroeconomics Books now!

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    Microeconomics by Justin Leroux,Nicolas Sahuguet. It means the sacrifices made ingroduction terms of - Resources are fully employed i. Resources are not lying idle. Normative Economics Positive Introductoin. Can be empirically verified. What determines the price rise? Govt has Eg — What is a fair price rise?

    Rate Unemployment is worse than poverty. It is pdv an unrealistic assumption. Related Papers.