In this article, we are going to provide a consumer surplus calculator, which will provide results on an automatic basis. Before approaching to consumer surplus calculator let us take an overview of consumer surplus. What is Consumer Surplus: An Overview In economics, the difference between the price that consumers actually pay and the maximum price they're willing to pay is the consumer surplus. You have probably seen curves describing supply (S) and demand (D) as a function of price (P) versus quantity (Q) if you have ever attended an economics lecture. If not, in the market surplus graph below, you can easily understand the notion. As a lower price implies a higher demand for a given article, the demand curve (D) is downward.
To make significant production decisions, businesses depend on multiple cost functions. In this article, we are going to discuss the average variable cost function, its uses for business decisions. Average Variable Cost Definition The TVC, total variable cost, per unit of output is known as the AVC, average variable cost. It can be found easily when the TVC, total variable cost, is divided by the total output (Q). TVC, total variable cost, is all the costs, such as materials and labor that vary with production. The best way to evaluate that variable cost is that if production increases so the cost increases as well. The AVC would be used by profit-maximizing companies to decide whether to continue their production or shut down it
The price elasticity of demand calculator measures the impact of price on quantity demanded. For example, if the price of an apple is 3$ and its quantity demanded is 2kg then what will be the impact of price on quantity demanded of apple when the price rise to 4$. The price elasticity of demand tells us about the rate of change in the quantity demanded of any commodity with respect to change in the price of any commodity. In this post, we are introducing our price elasticity of demand calculator where you can just put the value and it will measure the price elasticity and tell you about the kind of elasticity i.e. inelastic, elastic, unitary, etc. Price
Consumer Surplus Definition The consumer surplus is the economic welfare that consumer gets by consuming the products. The difference between the price of the product and the price that the consumer is willing to pay for that product is known as consumer surplus. This is the economic benefit to consumers because they pay less than what they are willing to pay. The consumer surplus arises when the consumer is willing to pay more as compared to the market price for a specific product. “Consumer surplus is the difference between the total amount that consumers are willing to pay for service or good and the total amount that they do pay.” Consumer Surplus Formula Consumer Surplus = Consumer Willingness to Pay – Market or Actual Price Consumer Surplus Example with Diagram When consumers
Before we are going to discuss the types of elasticity of supply I recommend you to study elasticity in economics and types of elasticity of demand for clear building of your concept. Supply means the provision of goods by the businesses against their price. In simple words, supply shows the availability of product or quantity supplied in the market against the market prevailing market price. With the change in the price level, the quantity supplied changes. Quantity supplied means the willingness of the supplier to supply a product on any specific price level. Many people confused between the types of elasticity of supply and demand, they thought that measurement of elasticity i.e. Perfectly Elastic, Relatively Elastic, Constant, Relatively Inelastic, and Perfectly Inelastic are the types of elasticity of supply and
The elasticity of demand measure the responsiveness of quantity demanded due to change in any other variable like price, income, etc. There are three main types of elasticity of demand but some economists considered them as four with the inclusion of advertising elasticity of demand. 4 Types of Elasticity of Demand All the types of elasticity of demand are enlisted hereunder. Price Elasticity of DemandIncome Elasticity of DemandCross Elasticity of DemandAdvertising Elasticity of Demand Now we are going to discuss all types of elasticity of demand in details one by one. Price Elasticity of Demand Price is the main factor which directly affects the demand for any product. Price Elasticity of Demand is considered at first in all types of elasticity of
During the boom in the market, it is almost impossible for a supplier to sell a stock at a price which is less than the purchase price. However, we can never be certain what the market will behave at any given time; we must not fail to remember the significance of well-diversified investments or portfolio, regardless of the market situation. To establish an investment strategy that offsets the possible losses in a market, the investor class suggesting the same as the real estate marketer advocates for buying a home by focusing on "location". In simple terms, you should never put all of your eggs in the same basket. This is the point where rational people need diversification. Before going into details
It has been observed that many of the students do not understand the key concept of Demand vs. Quantity Demanded, which needs to be understood before studying other theories of economics. This article will reveal the hidden insights of Demand vs. Quantity Demanded. So let's get started Do you observe that the necessities of life like water, food, clothes, etc. are cheaper or inexpensive in the daily routine life while luxurious goods like gold, cars, etc. are expensive? The law which is working behind the scene is the law of demand. A law which tells us how much demand of a consumer or group of consumers is being affected by his/their income, price of a particular good, change in the prices