An inferior commodity is one which is consumed in smaller quantities when the income of consumer Rises. In economics, an inferior good is a good whose demand decreases when consumer income rises unlike normal goods, for which the opposite is observed.
In long run equilibrium, the pure monopolist can make pure profits because of
Positive income elasticity implies that as income rises, demand for the commodity rises. A positive income elasticity of demand is associated with normal goods; an increase in income will lead to a rise in demand.
A firm under perfect competition will be making minimum losses (in the short run) at a point where
A firm under perfect competition will be making minimum losses (in the short run) at a point where MC=MR. In order to maximize profits in a perfectly competitive market, firms set marginal revenue equal to marginal cost (MR=MC).
Which of the following is not a feature of perfect competition?
Small number of buyers and sellers is not a feature of perfect competition. These are the three essential features of perfect competition: The number of buyers and sellers in the market is very large. These buyers and sellers compete among themselves. Due to the large number, no buyer or seller influences the demand or supply in the market.