case study on law of demand How a city uses law of demand to solve the problem

1. WALJAT COLLEGES OF APPLIED
SCIENCE
(BIT-MUSCAT) CASE STUDY
The law of
Demand in
a city of
Gujarat
Lekshmi S Nair
MBA/50026/11

5. Among the many environmental problems faced by India
is how to dispose the vast amounts of garbage generated
each day by households and businesses

6. One small community in Gujarat used The LAW OF
DEMAND to ease its garbage collection problem
Residents of this city
were paying an annual
fixed fee of Rs.120 per
resident for a daily
average of 2.2kgs

7. For example:
40kgs Rs.10
was sold
for:
The city
municipality began
charging by the bag
for garbage
collection. The city
required all trash be
placed in special
bags sold by Thus the marginal cost
municipality to residents of
generating additional
trash increased from 0 -
25paise per kgs

8. The municipality
introduced a recycling
program. Each
households was given
buckets to be filled
with cans and bottles
that were picked up
every week. The city
also arranged for
newspapers to be
collected once a
month.

9. Definition of 'Law Of Demand'
A microeconomic law that states that, all other factors
being equal, as the price of a good or service increases,
consumer demand for the good or service will decrease
and vice versa.

10. The result was predictable –
people began to dump less
trash. During the 1st year the
trash collections per person
declined to less than 1kg per
day.
The citizens benefited because they paid about 50 % less
than before and the municipality also reduced its garbage
collection costs.

11. Keep UR city
clean for a better
TOMORROW