lecture5 - Economics 103 Lecture # 5 The Law of Demand The...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Economics 103 Lecture # 5 The Law of Demand The Law of Demand is the most powerful idea in social science. We can graph a demand curve: A Brief Technical Digression: Discrete versus Continuous Variables. Technical digression cont. Technical digression cont. The answer … …because this is an equilibrium. -the equilibrium comes from maximization. Is our willingness to pay/sacrifice/substitute for something, the same as our ability to pay/sacrifice/substitute for something? What happens if the price changes? What happens if Py or M change?
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
What if X is inferior, or a complement with Y? Applications of Demand 1) The distinction between MV and TV. - there is an inverse relationship between TV and MV. TV vs. MV cont. - the diamond/gas paradox TV vs. MV cont. - “Hey dad, what is your favorite _____” 2) Obvious examples of the law of demand - fruit at harvest - border shopping - gas wars/ gas in West Abbotsford - parking at SFU, unix space - advertising sales
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 04/16/2009 for the course ECON 103 taught by Professor Hanafiahharvey during the Winter '08 term at Simon Fraser.

Page1 / 4

lecture5 - Economics 103 Lecture # 5 The Law of Demand The...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online