Notesale: Turn your study into money

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Concepts of Economics
S
...
No Concept
1

2

Consumers
Equilibrium
Single commodity

Consumers
Equilibrium

Conditions

Explanation

MUx =price

If MUx > Px consumer is in
gains, he will increase
consumption
...

So consumption of Goodx is
increased and consumption of
Goody is reduced
...
So
consumption of Goodx is
reduced and consumption of
Goody is increased
...

MRSxy < Px/Py - Consumer is
willing to give up less but he has
to give up more amount of other
good
...

Profits are not maximum
...


5

6

7

Market Equilibrium

Equilibrium level of
income ,output and
employment

Equilibrium level of
income ,output and
employment

Quantity
demanded
equals to
quantity
supplied
...
So output and
employment is reduced
...
So firms will increase
output by increasing
employment
S > I people are saving more and
consuming less
...
So output
and employment is reduced
...

S < I people are saving less
consuming more
...
So firms will
increase output by increasing
employment
...




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