Definition: The Price Elasticity of Demand is commonly known as the elasticity of demand, which refers to the degree of responsiveness of demand to the change in the price of the commodity. Types of price Elasticity of Demand The following are the main types of price elasticity of demand: Perfectly Elastic Demand (Ep = ∞): The demand is said to be perfectly elastic … [Read more...] about Types of Price Elasticity of Demand
Types of Elasticity of Demand
Definition: The Elasticity of Demand measures the percentage change in quantity demanded for a percentage change in the price. Simply, the relative change in demand for a commodity as a result of a relative change in its price is called as the elasticity of demand. Types of Elasticity of Demand Price Elasticity of Demand: The price elasticity of demand, commonly known … [Read more...] about Types of Elasticity of Demand
Elasticity of Demand
Definition: The Elasticity of Demand is a measure of change in the quantity demanded in response to the change in the price of the commodity. Simply, the effect of a change of price on the quantity demanded is called as the elasticity of demand. Marshall, a renowned economist, has suggested a mathematical method to measure the elasticity of demand: According to this … [Read more...] about Elasticity of Demand
Law of Demand
Definition: The Law of Demand asserts that there is an inverse relationship between the price, and the quantity demanded, such as when the price increases the demand for the commodity decreases and when the price decreases the demand for the commodity increases, other things remaining unchanged. In the definition, the “other things” are the factors that influence the demand … [Read more...] about Law of Demand
Types of Demand
Definition: The Demand for a product refers to the quantity of goods and services that the consumers are willing to buy at a particular price for a given point of time. Types of Demand The demand can be classified on the following basis: Individual Demand and Market Demand: The individual demand refers to the demand for goods and services by the single consumer, … [Read more...] about Types of Demand
Demand Analysis
Definition: The Demand Analysis is a process whereby the management makes decisions with respect to the production, cost allocation, advertising, inventory holding, pricing, etc. Although, how much a firm produces depends on its production capacity but how much it must endeavor to produce depends on the potential demand for its product. Thus, the marketer is required to … [Read more...] about Demand Analysis
Chi-Square Test
Definition: The Chi-Square Test is the widely used non-parametric statistical test that describes the magnitude of discrepancy between the observed data and the data expected to be obtained with a specific hypothesis. The observed and expected frequencies are said to be completely coinciding when the χ2 = 0 and as the value of χ2 increases the discrepancy between the … [Read more...] about Chi-Square Test
Chi-Square Distribution
Definition: The Chi-Square Distribution, denoted as χ2 is related to the standard normal distribution such as, if the independent normal variable, let’s say Z assumes the standard normal distribution, then the square of this normal variable Z2 has the chi-square distribution with ‘K’ degrees of freedom. Here, K is the sum of the independent squared normal variables. The … [Read more...] about Chi-Square Distribution
Properties of F-Distribution
Definition: The F-distribution depends on the degrees of freedom and is usually defined as the ratio of variances of two populations normally distributed and therefore it is also called as Variance Ratio Distribution. Properties of F-Distribution There are several properties of F-distribution which are explained below: The F-distribution is positively skewed and with the … [Read more...] about Properties of F-Distribution
F-Distribution
Definition: The F-Distribution is also called as Variance Ratio Distribution as it usually defines the ratio of the variances of the two normally distributed populations. The F-distribution got its name after the name of R.A. Fisher, who studied this test for the first time in 1924. Symbolically, the quantity is distributed as F-distribution with ν1 =n1-1 and ν2 = n2-1 … [Read more...] about F-Distribution