Theory of demand, Microeconomics

THEORY OF DEMAND:

The  consumer behaviour under indifferencecurve approach where it is assumed that the consumer possesses a utilityfunction. The next most important theory that deals with consumer behaviouris the theory of revealed preference. This theory allows prediction of theconsumer's behaviour without specification of an explicit utility function,provided that she conforms to some simple axioms. In addition, the existenceand nature of her utility function can be deduced from her observed choicesamong commodity bundles. 

we move on to more realistic aspect of consumerbehaviour namely consumer choice involving risk, where there is probabilityof every event. Finally, we present the indirect utility function and its relatedtheorems.  

Posted Date: 10/26/2012 3:30:21 AM | Location : United States







Related Discussions:- Theory of demand, Assignment Help, Ask Question on Theory of demand, Get Answer, Expert's Help, Theory of demand Discussions

Write discussion on Theory of demand
Your posts are moderated
Related Questions



1. "Price discrimination allows a monopoly to increase its economic profit by capturing part of the consumer surplus and turning it into economic profit. Such a situation however l

Infrastructure : Infrastructure plays an important role in the development of an economy. The adequacy or lack of it determines an economy's success or failure in increasing p

Explain how consumers might benefit from the existence of monopolies. While the standard issue of monopolies having higher prices and lower output that competitive markets migh

Problem 1: i) To what extent can a country actually rely on the principle of Comparative advantage before engaging in international trade? ii) Explain the different types

Slutsky Theorem - Mathematical Presentation: We already know from the first order conditions of utility Maximisation that,   where D ij is the co-factor of the ith ro

how do cooperative and noncooperative games differ

Price/Earnings (P/E) Ratio This is a measure of an organization investment potential. Literally, a P/E ratio is how much a share is worth per dollar of earnings. The price-earn