Economics in our Every Day Life
Law of Demand
I went to market, and I used to buy tomatoes in huge
quantity at Rs. 20 per kg before. Now recently the price has increased to Rs.
40 per kg. So I will decrease my quantity of buying tomato. This is Law of
Demand which mean when price rises, the quantity demand falls and vice versa,
others things remaining constant.
Opportunity Cost
I went to a shopping mall for shopping as well as to watch
movie and I have a very limited time. For some reason I reached late there. As I
have very limited time I realised that shopping as well as movie won’t be
possible at the same time and I have to sacrifice one for the other. So I decided
to watch movie and sacrificed shopping for it. This is Opportunity Cost.
Law of Diminishing Marginal Utility
I went to KFC to have my dinner. There I ordered large
bucket of 6 pieces’ chicken. The utility which I’ll get after having the first
piece of chicken will be more. It will give me great satisfaction. Now after
taking the second piece the utility will be less than the first one. Now again
the third one will give more less satisfaction from the second one. Like this the
marginal utility derived from each additional utility declines. This is known
as Law of Marginal Utility.
People respond to intensives
We all go for shopping in the season of Durga Puja. So there
are many malls which gives discounts and offers. One of them is Brand Factory
which give more discounts (30% to 60% off). I decided to go there and do my shopping.
So here for those incentive I’m going there to shop. This is known as People
Respond to Incentives.
Law of Supply
In summer we can see that the price of the air condition is
high and any other season. So that time the manufacturer will make supply more
air condition to sell in the market and earn huge revenue. This is known as Law of Supply i.e. when
the prices rise the quantity supply rises and vice versa, other things remaining
constant.
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