02-Market Mechanism

02-Market Mechanism - Supply-and-Demand Model The Market Mechanism Reading Chapter 2 1 Demand Quantity demanded is the amount of a good that

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1 Supply-and-Demand Model: The Market Mechanism Reading: Chapter 2
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2 Demand Quantity demanded is the amount of a good that consumers are willing and able to buy at a given price (holding constant other factors that affect demand) Refers to the point on the demand curve Demand refers to the amount of a good that they are willing and able to buy at all alternative prices . Represented by the demand curve
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3 Demand Curve D The demand curve slopes downward, demonstrating that consumers are willing to buy more at a lower price as the product becomes relatively cheaper. Quantity   Price ($ per unit) P 1 Q 1 P 2 Q 2
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4 Shifts of the Demand Curve Change in price Movement along the demand curve Change in Income Prices of substitutes and compliments Consumer tastes Information (or misinformation) Shift of the whole demand curve
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5 Supply Quantity supplied is the amount of a good that firms are willing to sell at a given price (holding all else constant)
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This note was uploaded on 07/06/2009 for the course ECON 102A taught by Professor Sorensen during the Spring '08 term at UC Riverside.

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02-Market Mechanism - Supply-and-Demand Model The Market Mechanism Reading Chapter 2 1 Demand Quantity demanded is the amount of a good that

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