Chapter-12 Forms Of Market

11th English Medium, 12th English Medium
MARKET The tern market refers not necessary to a place but always to a commodity and the buyers and sellers who are direct competition with one another.   PERFECT COMPETITION Perfect competition is a market situation in which no seller can influence price by his independent action. In such a market a firm is only a price taker and industry is the price maker.”   FEATURES OF PERFECT COMPETITION   VERY LARGE NUMBER OF BUYERS AND SELLERS   HOMOGENEOUS PRODUCT   FREE ENTRY AND EXIT OF THE FIRM   PERFECT KNOWLEDGE   PERFECT MOBILITY   ABSENCE OF TRANSPORTATION COSTS   ABSENCE OF SELLING COSTS   Under perfect competition Industry is the price maker and firm is a price taker. Explain?   Difference between industry and firm   PRICE DETERMINATION  …
Read More

Chapter-11 SUPPLY

11th English Medium, 12th English Medium
SUPPLY supply of a commodity refers to a various quantities of a commodity that the producers are willing to sell at different prices of the commodity at a point of time.   STOCK Stock of a commodity refers to the total quantity of that commodity which at any given time is a available in the market with the seller.   DIFFERENCE BETWEEN STOCK AND SUPPLY An agriculturist who has produced 500 quintals of wheat during a given period may offer for sale 100 quintals @ of  Rs 200 per quintals, 150 quintals @ of Rs 250 per quintals. In this case stock of wheat is 500 quintals and supply is 250 quintals at different prices.   SUPPLY AND QUANTITY SUPPLY Quantity supplied refers to a specific quantity of a commodity…
Read More

Chapter- 10 Production’s Equilibrium

11th English Medium, 12th English Medium
Meaning of profit Profit refers to the excess of receipts from the sale of goods over the expenditure incurred on producing them.   Producer’s equilibrium Producer’s equilibrium refers to that price and output combination which brings maximum profit to the producer and profit declines as more is produced.   There are two methods for determination of producer’s equilibrium: Total revenue and total cost approach (TR-TC approach) Marginal revenue and marginal cost approach (MR-MC approach)   Both the conditions are needed for producer’s equilibrium   MC=MR MC is greater than MR after MC= MR output level   Relation between price and MC at equilibrium (when price remains constant) When price remains same at all levels of output, then price (or AR) = MR. as equilibrium is achieved when MC=MR, it means,…
Read More

Chapter-9 REVENUE

11th English Medium, 12th English Medium
REVENUE Revenue of a firm is its sale receipt or money receipt from the sale of a product.” For example, if a firm gets Rs 16,000 from sale of 100 chairs the amount of Rs 16,000 is known as revenue.   TOTAL REVENUE Total revenue is a sum of all the sales receipts.” Total revenue refers to total receipts from the sale of a given quantity of a commodity.   AVERAGE REVENUE Average revenue is the per unit revenue received from the sale of a commodity.                   AR = TOTAL REVENUE                                 QUANTITY SOLD                   AR = PRICE * QUANTITY SOLD                                 QUANTITY SOLD    MARGINAL REVENUE Marginal revenue is a change in total revenue which results from the sale of one more of one less unit of…
Read More

Chapter- 8 COST

11th English Medium, 12th English Medium
MEANING OF COST OR PRODUCTION COST Money expenditure incurred by a firm in production of a commodity is called the cost of production.   COST FUNCTION A cost function studies the functional relationship between cost and output   SELLING COST Selling cost refers to the expenditure incurred by the producer in order to promote sale of the commodity   REAL COST Real cost refers to the pain, discomfort and disutility involve in supplying the factors of production by their owner.    EXPLICIT COST These are those cash payment firm makes to outsider for their goods and services. For Example: wages are paid to the workers, payment made for raw material and semi manufacture good, interest pay on loan, depreciation allowances.   IMPLICIT COST Implicit costs are cost of self owned…
Read More

Chapter-7 Production Function

11th English Medium, 12th English Medium
CONCEPT OF PRODUCTION FUNCTION Production function is an expression of the technological relationship between physical inputs and physical output of a commodity.   PERIOD IN PRODUCTION VERY SHORT PERIOD SHORT PERIOD LONG PERIOD   Variable factors and Fixed factors Variable factors Variable factors refers to those factors, which can be changed in the short run, for example raw material, casual labour, power fuel etc. Variable factors very directly with the level of output . As output increase, requirement for variable factors also rises.   Fixed factors Fixed factors refers to those factors, which cannot be changed in the short run. For example plant and machinery, building, land etc.   CONCEPT OF PRODUCTION TOTAL PHYSICAL PRODUCT (TPP) OR TOTAL PRODUCT (TP): “Total physical product is the total quantity of goods and…
Read More

Chapter-6 Elasticity of Demand

11th English Medium, 12th English Medium
DEFINATION OF ELASTICITY OF DEMAND “The elasticity of demand measures the responsiveness of the quantity demanded of a good, to change in its price, price of other goods and changes in consumer’s income.”   PRICE ELASTICITY OF DEMAND: “The price elasticity of demand is the degree of responsiveness of the demand for a commodity to change in its price.”   INCOME ELASTICITY OF DEMAND: “The Cross elasticity of demand is the degree of responsiveness of the demand for a commodity X to change in its price of commodity Y.”   CROSS ELASTICITY OF DEMAND: “The Cross elasticity of demand is the degree of responsiveness of the demand for a commodity X to change in its price of commodity Y.”   PERFECTLY ELASTIC DEMAND: “It is a situation where demand for…
Read More

Chapter- 5 Demand

11th English Medium, 12th English Medium
DEMAND: Demand is the quantity of a commodity that a consumer is willing and able to buy, at each possible price during a given  period of time.”   DEMAND CURVE: A demand curve is graphical representation showing different quantities of a commodity demanded at different prices during a given period of time.   MARKET DEMAND:  Market demand is the total quantity for a commodity which all the individual buyers in the market are willing to buy at different prices in a given period of time .   MARKET DEMAND SCHEDULE: Market demand schedule is the table which shows all the individual buyers in the market are willing to buy at different prices in a given period of time.   PRICE OF THE COMMODITY: “Relationship between demand for a commodity and…
Read More