Answered: Oligopoly t. Induced u.…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

1. Write a sentence or two defining the following terms in your own words. Give examples of each.

s. Oligopoly

t. Induced

u. Inelastic Demand

Expert Solution

Step 1

Microeconomics: It is a part of economics in which the consumption of individuals will take into consideration because it considers economy from a point of view of the individuals not as a society or as a whole.

Step 2

Oligopoly: It is a market in which there are small number of firms which can form a cartel and these firms have no influence on each other. The factors like economic, technical and legal can lead to change in the maintenance and formation of the oligopoly market. For example: automobile market.
Induced: It means to persuade someone to buy something. In economics induce consumption depends on the disposable income. When the disposable income of the people changes it leads to the change in the consumption of the people and induced consumption leads to the change in the consumption. For example: this occurs in the case of normal goods.
Inelastic demand: It refers to that demand of goods and services in which if the prices of those goods increase or decreases the people will still buy the goods and services. For example: food.

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