Consumer Equilibrium Class 11 Notes Free [better] Jun 2026
Keep these formulas handy for quick revision and numerical problem-solving: Total Utility: Equilibrium (Single Good): Equilibrium (Two Goods): Marginal Rate of Substitution: Conclusion
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Each curve represents a unique, distinct level of satisfaction. The Budget Line Keep these formulas handy for quick revision and
Utility is the want-satisfying power of a commodity. It varies from person to person, place to place, and time to time. Key Characteristics of Utility It depends on the consumer's mental state. Relative: It changes with time and place. It varies from person to person, place to
The cardinal approach determines consumer equilibrium under two different scenarios: a single commodity and two or more commodities. Case A: Single Commodity Scenario
A harmful commodity (like liquor) may have utility for an addict. Measurement of Utility Economists express utility through two primary approaches:
When MU is zero, TU reaches its maximum point (Point of Satiety). When MU becomes negative, TU starts to decline. 3. Law of Diminishing Marginal Utility (DMU)