Page 137 - DECO401_MICROECONOMIC_THEORY_ENGLISH

Microeconomic Theory

Notes more than per unit of demand. The reason behind this, the cost of a product increases when elasticity
of demand is high and the price of that product is low. The producers should increase the price of
their product when the elasticity of demand decreases than unity.

6.24 Keywords

• Market Demand: Total demand from buyers
• Inferior Goods: Poor Goods
• Extension of Demand: Rise in demand
• Contraction of Demand: Low in demand

6.25 Review Questions

1. What is the meaning of conception of demand? Explain it.
2. What do you mean by Price Elasticity of Demand?
3. What is Point Elasticity Procedure? Explain with example.
4. What is Cross Elasticity of Demand and its types?

Answers: Self Assessment

1. Prices 2. Price 3. Direct 4. (a)
5. (b) 6. (a) 7. (a) 8. True
9. True 10. False 11. False 12. True

6.26 Further Readings

1. Microeconomics—Frank Cowbell, Oxford University Press, 2007.
2. Microeconomics—Shipra Mukhopadhyay, Annie Books, 2011.
3. Microeconomics: An Advanced Treaties—S.P.S. Chauhan, PHI Learning.

130 LOVELY PROFESSIONAL UNIVERSITY