Want to start a startup? Get funded by Y Combinator. October This essay is derived from a talk at the Startup School.
Economics The demand for newspaper is inelastic while the supply for newspaper is elastic in the short run.
This means the quantity demanded for newspaper does not respond strongly to price changes but the quantity supplied for newspaper is responsive to price changes in the short run. Mankiw, The demand is inelastic because newspaper has very few substitutes.
Although online news is getting popular nowadays, the majority still prefer to read the papers. Besides, newspaper is a necessity which people read every day to know what happens around the world.
Mankiw, The supply of newspaper is elastic because firms that produce manufactured goods such as newspapers can run their factories longer Elastic demand essay response to a higher price. Mankiw, From the graph, we can derive the table below: Both tax levied on sellers and tax levied on buyers place a same size of wedge between the price that buyers pay and the price that sellers receive Mankiw, Regardless of how the tax is levied, buyers and sellers share the tax burden Mankiw, Buyers pay more and sellers receive less.
Meanwhile the government revenue from collecting taxes increases by the area B and D. As a result, total surplus decreases by the area C and E causing a deadweight loss.
Tax has made both consumers and producers worse off and it decreases the overall welfare of society. The equilibrium quantity falls after a tax is imposed causing the market of newspaper to shrink. Mankiw, Negative consumption externalities cause a difference between private benefit and social benefit Tutor2u, n.
The intersection of the marginal-private-cost curve and the marginal-social-benefit curve determines the optimal output level.
From the diagram, we can know that it is less than the market equilibrium quantity. This shows that the good is over-consumed. There will be a deadweight loss of economic welfare.
Negative production externalities cause a difference between private cost and social cost because social cost takes into account of both the private cost and the external cost.
This means that the cost to society of producing one good is larger than the cost to the producers Tutor2u, n.
The optimal output level is determined by the intersection of the marginal-private-benefit curve and the marginal-social-cost curve. It is also less than the market equilibrium quantity according to the diagram above.
Again there will be a deadweight loss.The following essay helps us know what demand and supply concept and that we are explaining with the example of cigarette industry. Macroeconomics Coursework - It is the role of every government to safeguard its people in all matters including controlling the economy.
Meanwhile, in Greece popular movements had been raising the old demand that land be redistributed and debts be canceled. Men of wealth in Greece sent representatives to Rome's senate where they appealed for help.
Some Romans wanted their city to avoid entanglements in Greece in order to avoid.
Elasticity tells us how much quantity demanded changes when price changes. The elasticity of demand is a measure of how responsive quantity demanded is to a change in price. A demand curve is elastic when a change in price causes a big change in the quantity demanded.
The opposite is true of inelastic curves. Published: Mon, 5 Dec The following essay helps us know what demand and supply concept and that we are explaining with the example of cigarette industry.
Income elasticity of demand may be defined as the ratio or proportionate change in the quantity demanded of a commodity to a given proportionate change in the income - Income Elasticity of Demand Essay introduction.
In short, it indicates the extent to which demand changes with a variation in consumer’s income.