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Explain the difference between marginal returns to factor and returns to scale?


The short-run is defined as the period during which one cannot vary at least one of the factors of production, i.e. at least one factor of production is fixed. The long-run is defined as the period during wh...
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Answered by Julia S. • Economics tutor
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Explain the concept of price elasticity of demand? How does one calculate it? What is the relationship between price elasticity of demand and firms’ total revenue?

Price elasticity of demand (PED) is a measure of the responsiveness of demand for a product after a change in that product’s price. It is calculated with the following formula: PED = %change in quantity dema...
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Answered by Julia S. • Economics tutor
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Explain how a change in one of the determinants of supply could lead to a decrease in the price of rice.

Supply is the quantity of a certain product that a producer is willing and able to supply into a market at a given price, in a given time period. Consider the market for rice: an abnormally fruitful harvest ...
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Answered by Julia Z. • Economics tutor
12938 Views

What is a negative externality and how can you address them?

An externality is a benefit or a cost borne by a third party when producing or consuming a good. Hence there can be negative and positive externalities of production and consumption. E.g. Cigarettes have a n...
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Answered by Sofia D. • Economics tutor
12761 Views

What is the difference between a shift and a movement in the demand (or supply) curve?

A shift in the demand curve occurs when there is a non-price determinant of demand, including a change in consumers' income, changing trends and tastes, changes in the price of complementary and substitute g...
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Answered by Sofia D. • Economics tutor
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