Law of Diminishing Returns

Law of Diminishing Returns

    The law of diminishing returns states that when successive units of a variable resource such as labor are added to a fixed resource such as capital or land beyond some point, the amount of extra product that can be attributed to each additional unit of variable resource will decline. The law assumes that technology is fixed and thus the techniques of production do not change.

The law of diminishing returns showed that if you hired too many harvesters, productivity and final cost actually worked in an opposing way. Because the amount of land didn't increase, there would be too many harvesters, each doing only a little work. Therefore, productivity actually decreased. Moreover, the cost of hiring all the harvesters was high, especially considering that lowered productivity. The law of diminishing returns proved there's a point at which hiring more harvesters actually hurts the farm's bottom line.



http://www.clickz.com/clickz/column/1701111/the-law-diminishing-returns

Short Run

Short Run: Fixed Plant

    
    Short run is a period which is too brief for a firm to alter its plant capacity, yet long enough to permit a change in the degree to which the plant's current capacity is used in microeconomics. By applying larger or smaller amounts of labour, materials and other resources to that plant, a firm can vary its output even though the firm’s plant capacity is fixed in the short run.


InfoPrint 5000 was chosen by BR Printers to meet the high demands of their customers. Immediately after installation, the InfoPrint 5000 provided cost-savings for BR. Previously; the company was outsourcing most colour jobs and utilizing in-house cut sheet printers for its monochrome jobs. By replacing these models with the InfoPrint 5000, thereby eliminating the need for outsourcing, the company was able to realize bottom line increases.



http://www.zdnet.com/blog/doc/case-study-of-short-run-book-printing/2186

Marin Real Estate Market Lacking Equilibrium

PRICE THEORY : MARKET EQUILIBRIUm

 

 Market Equilibrium happens when both buyers and sellers come to an agreement to exchange goods and services. When this occurs,  the price does not increase or decrease. In other words, Market Equilibrium is the condition that exists when a state of balance occurs between market demand and market supply.





The Graph shows that supply and demand agrees to produce a certain amount of product for a given price.
 



 
Marin Real Estate Market Lacking Equilibrium

Today's housing climate features low interest rates, tight inventory and excess demand that is making multiple offer situations common again.

For the past several years during the downward cycle in the housing market, we have seen an oversupply of homes and very little demand at price levels that were elevated but dropping. Even through 2011, demand continued to lag despite low housing prices and absurdly low interest rates. But fundamental economics finally kicked in and the market has changed due to a scarcity of inventory.

 

 

If you are a home buyer wanting take advantage of today’s low prices and interest rates here are a few tips that will help you succeed. First and foremost pay close attention to the market and when a home you like comes on the market down wait and watch, or the opportunity will surely pass you by. Get comfortable with the idea that if there is more than one offer you will likely have to pay more than the asking price for the property.

 

 

 

( SOURCE: http://sanrafael.patch.com/groups/andy-falks-blog/p/bp--featured-blog-marin-real-estate-market-lacking-equilibrium )

Written By : Ng Pui Yan 0313660

 

 

 

  

 

  

DEMAND AND SUPPLY

Demand and Supply - Case Study / Information

Written by Tham Chia Shing

NEW DELHI - The demand for poultry products is like to remain strong in the April-June period of this year, mainly due to this holiday period.

The market is currently well-balanced in terms of demand and supply, although profitability was still below average. The prices were very high during the January-March period. However, prices softened in March because of increased supply in April. On poultry feed, prices of corn has declined but soyameal prices has increased crazily. Therefore, the support price has been increased to result in higher production to satisfy the citizens needs. Also, the government has clarified that that import of genetically modified soyameal are allowed to India.

HAVE YOU EVER WONDERED ?



WHY IS THE MARKET CURRENTLY WELL BALANCED ALTHOUGH PROFITABILITY WAS STILL BELOW AVERAGE ?

This is because the demand and supply still exist in the equilibrium rate.

WHY IS THE PRICES OF POULTRY PRODUCTS SOFTENED IN MARCH ?

This is because there was increase in supply in April to help the citizens that demanded for reducing price.

WHY IS THERE AN INCREASE IN THE SUPPORT PRICE ?

This is because to increase production rate to satisfy the customers needs to maintain the economic structure.

WHY ARE GENETICALLY MODIFIED SOYAMEALS ALLOWED INTO INDIA ?

This is because to make sure the soyameals company in India reduces their price.

EXTRA INFORMATION

Demand is the desire and ability to consume certain quantities of a good and service at certain prices at a particular point of time.

Figure 1: Demand Curve

  Supply is the quantity of goods and services willing to be produced by firms or offered for sale at a particular time or particular place at alternative prices.

Figure 2: Supply Curve

Economic System of North Korea

written by Tham Chia Shing

Economy - overview: North Korea, one of the world's most centrally directed and least open economies, faces chronic economic problems. Industrial capital stock is nearly beyond repair as a result of years of underinvestment, shortages of spare parts, and poor maintenance. Frequent weather-related crop failures exacerbated chronic food shortages caused by on-going systemic problems, including a lack of arable land, collective farming practices, poor soil quality, insufficient fertilization, and persistent shortages of tractors and fuel. The economic system of North Korea is command economy. The goverment has allowed private "farmer markets" to begin selling a wide range of goods and also allowed some private farming to increase agricutural production due to the experiments in 2002.

In 2012, KIM Jong Un's first year of leadership, the North displayed increased focus on the economy by renewing its commitment to special economic zones with China, negotiating a new payment structure to settle its $11 billion Soviet-era debt to Russia, and purportedly proposing new agricultural and industrial policies to boost domestic production. The North Korean government often highlights its goal of becoming a "strong and prosperous" nation and attracting foreign investment, a key factor for improving the overall standard of living.

Extra Information:

DO YOU KNOW WHY DOES THE NORTH KOREA WANTED TO CHANGE TO MIX MARKET???

Because the population continues to suffer from prolonged malnutrition and poor living conditions.

(Source: http://www.indexmundi.com/north_korea/economy_overview.html)