The following points highlight the ten major causes of change of demand for a commodity. The causes are: 1. Changes in Taste and Preferences Habit and Fashion 2. Changes in the Income of the People 3. Changes in the Prices of Related Goods 4. Changes in Population and Number of Potential Buyers, 5. Changes in the Pattern of Income Distribution, [...]
Let us make an in-depth study of the transactions at disequilibrium prices. The equilibrium price is also called the market clearing price. But the market price is the one that actually prevails at any point of time. The equilibrium price does not rise or fall unless there is a change in the demand and supply schedules shown in Table 9.2. [...]
Let us make an in-depth study of the effect of an indirect tax on a commodity. The imposition of an indirect tax on a commodity such as a sales tax or excise duty causes the supply curve for that commodity to shift to the left because when a tax is imposed the cost of supplying the commodity to the market [...]