econ101 ch3 notes

econ101 ch3 notes - 1. characteristics of a "market" a...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
1. characteristics of a “market” a group of buyers and sellers who want to trade amongst themselves 2. law of demand when the price goes up, we buy less when the price goes down, we buy more 3. distinguish between 6. state of equilibrium certain amount of a good being bought and sold at certain price 11. Four Key Steps to answer questions about the economy define the markets and identify the decision-makers identify the goals and constraints identify the equilibrium process study how policies and events affect the equilibrium Supply and Demand Model 3 Elements: 1) buyers / consumers / customers 2) sellers / producers / firms 3) marketplace for interactions Q1. How does the market system allocate to a single household of consumers? Q2. What determines a household's demand for eggs? 1) Tastes 2) Income level 1. two types of goods: 1. normal good 1. increase in income -> demand increases 2. inferior good 1. increase in income -> demand increases 3) Price of good 4) Price of other product
Background image of page 1

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

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 09/23/2009 for the course ECON 101 taught by Professor Brentkreider during the Fall '07 term at Iowa State.

Page1 / 2

econ101 ch3 notes - 1. characteristics of a "market" a...

This preview shows document pages 1 - 2. Sign up to view the full document.

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