Lecture3 - Supply and Demand Ariel Singerman January 18,...

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Unformatted text preview: Supply and Demand Ariel Singerman January 18, 2008 Ariel Singerman () Supply and Demand January 18, 2008 1 / 10 Introduction to Supply and Demand In this lecture we are going to introduce the basic economic model of supply and demand Definition A market is a group of buyers and sellers with the potential to trade with each other. Note that in economics a market is not a particular place but rather a collection of buyers and sellers Ariel Singerman () Supply and Demand January 18, 2008 2 / 10 Demand and the law of demand Definition The quantity demanded of a good or service is the number of units that all the buyers in a market would choose to buy, given the constraints that they face. There is a negative relationship between price and quantity demanded. Such a relationship gives rise to the law of demand. The law of demand states that when the price of a good rises and everything else remains the same (ceteris paribus), the quantity of the good demanded will fall....
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This note was uploaded on 03/27/2008 for the course ECON 102 taught by Professor Singerman during the Spring '08 term at Iowa State.

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Lecture3 - Supply and Demand Ariel Singerman January 18,...

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