Topics:

• Paper includes 70 Problems and 30% Theory
• Elasticity of demand
  • Theory and numericals
• Consumer behaviour and utitlity and maximization
  • Theory and numericals
• Budget line concept and numerical

Following is incomplete but last topic is important

Elasticity

$Ed = \Delta Q_d / \Delta P$

Types of elasticity:

1. Arc elasticity:
2. Point elasticity
3. Substitutes and compliments (Price change of a substitutes effects on the quantity of the product)
4. Advertising elasticity:

Demand Curve:

• Perfectly inelastic: Increase in price does not change quantity supplied ⇒ Ed < 1 ⇒ $\Delta P > \Delta Q_d$