--%>
Assignment Help - homework help

Explain the reasons for demand curve slopes downward

Explain the reasons for demand curve slopes downward.

E

Expert

Verified

Demand curve slopes downward it starts from left to right that is called Negative Slope. There are several causes for downward sloping of demand curve as follows:

• Law of Diminishing Marginal utility and Principle of Equal Marginal Utility
• Income and Substitution effect.
• Various uses of a commodity and Psychology of people.
• Affinity of human beings to satisfy/unsatisfied needs.

   Related Questions in Managerial Economics

  • Q : Minimum supply to specified amounts of

    If the owner of a resource is paid in excess of the minimum needed to supply specified amounts of the resource, in that case the owner is the beneficiary of: (1) economic rents. (2) wage premiums. (3) excess profits. (4) surplus values. (5) capitaliza

    		•
  • Q : What is Increasing Returns to scale

    What is Increasing Returns to scale?

    		•
  • Q : External factors in governing prices

    What are the external factors in governing prices?

    		•
  • Q : Explain the target pricing briefly

    Explain the target pricing briefly.

    		•
  • Q : Adjust inputs of labor other resources

    Firms adjust their inputs of labor or other resources till: (w) revenue is maximized. (x) employment is maximized. (y) marginal product of labor is maximized. (z) profit is maximized. Please choose the right answer

    		•
  • Q : Determine market supply of labor The

    The market supply of labor is the sum of the: (1) quantities of labor supplied by households at each wage. (2) wages paid to households for each quantity supplied. (3) quantities demanded by firms at each wage. (4) marginal products of labor at each l

    		•
  • Q : Most exceed the wages or specific

    Firms tend to offer wages which most greatly exceed the wages which workers would earn elsewhere to workers who have: (1) profit-sharing plans. (2) specific training. (3) prenuptial agreements. (4) non-compete clauses in their work contracts. (5) general training.

    		•
  • Q : Offsets the amount of revenue to added

    Profit maximizing firms will adjust their employment of labor till the last employee hired adds: (w) more to the firm’s revenue than this adds to cost. (x) more to the firm’s cost than this adds to the firm’s revenue. (y) an amount o

    		•
  • Q : Where managerial economics treat as a

    Where managerial economics treat as a tool? Answer: Managerial economics is like a tool for decision making and forward planning.

    		•
  • Q : State the causes for downward sloping

    State the causes for downward sloping of demand curve?

    		•