world of economics

Theory of rent

Introduction Unlike variable factor, the marginal productivity theory of distribution fails to determine price of factor whose supply is fixed (e.g. land) or quasi fixed (e.g. capital equipment) as there is zero marginal product of fixed factor. There exists separate body of theory, i.e. theory of rent which helps explain the pricing of these fixed factors.  According to classical theory,...
world of economics

Theory of profit

Introduction Profit is the financial benefit realized from the business activity when the revenues generated exceeds the costs and expenses incurred in the operation of such activities. Simply, the total cost deducted from total revenue yields profit. The profits of the organization depend on the successful management of business operations, i.e. how well an entrepreneur manages the risks and uncertainties of...
world of economics


A Oligopoly is a market structure in which a few firms sell either a standardized or differentiated product into which entry is difficult in which the firm has limited control over product price because of mutual interdependence (except when there is collusion among firms) and in which there is typically non-price competition. Characteristics of oligopoly 1. few NUMBER OF FIRMS...
world of economics

Monopolistic Competition

A Monopolistic competition is a market structure in which many firms sell a differentiated product into which entry is relatively easy in which the firm has some control over its product price and in which there is considerable non price competition. Monopolistic competition is a type of imperfect competition such that many producers sell products that are differentiated from one...
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