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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.
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Economic Rent - Economic rent is difference between what firms are willing to pay for the input less the minimum amount required to obtain it. * An Example - There are tw
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Normal profit: Normal profit is when total revenue is exactly equal to total cost when the latter includes both explicit costs. It is the type of profit when made by firms in
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