A study of cost of production in this article shall complete our understanding of the supply side scenario. We have analyzed producer’s behaviour to understand how a producer will reach to the least cost factor-combinations based on efficient methods of production for a level of output. However, while doing so we only considered factors of […]
Cost Behaviour of a Firm: Short and Long Run | Economics
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Factor Demand Curve of a Firm (With Diagram)
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Factor Demand Curve of a Firm: Under competitive market, factor demand curve of an industry is derived by summing up the demand of a factor by each individual firm at different given prices. Firms being price taker will demand a quantity where value of its MPP (i.e. VMP) equalizes with the wage level. Following Figure-14.3 […]
Time Element and Price Determination under Perfect Competition | Microeconomics
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Time Element and Price Determination under Perfect Competition! Under perfect competition, price of the commodity is determined by the forces of demand and supply. Marshall, who propounded the theory says the price is determined by the forces of demand as well as supply. He also laid emphasis on the time element in the determination of […]