note2 - ch3

note2 - ch3 - Econ 251 Fall 2009 Handout 4 09/03/09 Chapter...

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

View Full Document Right Arrow Icon
Econ 251 Fall 2009 Handout 4 09/03/09 1 Chapter 3 (cont’d.) – Demand and Supply I. MARKET EQUILIBRIUM A&D CHA&GES I& THE EQUILIBRIUM Def. Market A market is any arrangement that enables buyers and sellers to get information and to do business with each other. Def. Market Equilibrium Equilibrium in a market occurs when _________________________________________. The equilibrium price is the price at which the __________________________________. The equilibrium quantity is the quantity _______________________________________. Example 1 : Supply and Demand Schedules: Q s Q d P (in $) Surplus or Shortage? 0 6 0 0 5 2 4 4 4 8 3 6 12 2 8 Equilibrium price P* = _______ Equilibrium quantity Q* = _______ c If Q s > Q d b ______________________ c If Q s < Q d b ______________________ Price acts as __________________________________________________________________!
Background image of page 1

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

View Full DocumentRight Arrow Icon
Econ 251 Fall 2009 Handout 4 09/03/09 2 Example 2 : The Market for Mars chocolate bars 1 6 'Demand Function' 2 2 4 'Supply Function'
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.

Page1 / 6

note2 - ch3 - Econ 251 Fall 2009 Handout 4 09/03/09 Chapter...

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