Theory of Consumer Behaviour
Concept of Utility
Introduction Existence of human wants forms the basis of all economic activities. Want refers to an effective desire for a particular commodity by a human being who gets satisfied after making an effort to acquire it. The characteristics of wants are: Wants are multiple and multiply with time Wan .... Read MoreLaw of Diminishing Marginal Utility
Introduction The law of diminishing Marginal utility was initially formulated by a German economist H.H. Gossen. It was later systematically formulated by Alfred Marshall. The law of diminishing marginal utility states that as more and more units of a commodity are consumed, marginal utility d .... Read MoreUtility Analysis
Introduction Utility refers to the want satisfying power of a commodity. The main concepts of utility are marginal utility and total utility. Consumer’s equilibrium refers to the level of consumption where the consumer gets maximum level of satisfaction from consumption of the good with his giv .... Read MoreIndifference Curve Analysis
Introduction The history of indifference curve(IC) can be traced backed to 1881, when Edgeworth had originally invented the indifference curve which was later on fully developed by British economist J.R. Hicks and R.G.D. Allen. An Indifference curve shows different combinations of two goods for whi .... Read MoreTo Access the full content, Please Purchase