Writing

MATERI KULIAH


3. Writing.

Text :

”PRICES”

In most economic system, the prices of the majority of goods and services do not change over short periods of time. In some system if is cause possible for an individual to bargain over prices, because they are not fixed in advance. In general term, however, the individual cannot change the prices of the commodities he wants. When planning has expenditure, he must therefore accept these fixed prices.

he must also pay this same fixed price no matter how many units he buys. A consumer will go on buying bananas for as long as be continues to be satisfies. If he  money. With each successive purchase, however, his satisfaction ompensates less for the loss of money.

A point time comes when the financial sacrifice is greater than the satisfaction of eating bananas. The consumer will therefore stop buying bananas at the current price. The bananas are unchangesd, they are no better or worse. than before Their marainal utility to the consumer has, however, changed.If the price had been higher he might have bought fewer bananas, if the price had been lower, he might have bought more.

It is a learn from this argument text the nature of a commodity remains the same, but is utility changes this indicates that a special relationship exists bots on goods and services on the one hand, and a consumer and his money change other hand. The consumer’s desire for a commodity. Economists call this tendency the law of diminishing Marginal Utility.

Answer the Questions

ü   Prices are fixed in most economic system, but what is possible in some system ?

ü   Under what conditions will a consumer go on buying a commodity ?

ü   What does the consumer show buying more bananas?

ü   What happens with each successive purchase ?

What does a consumer desire trend to do ?

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