Topic_3__Supply_and_Demand - Supply and Demand Demand...

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1 Supply and Demand Demand Supply Market Equilibrium Consumers and Producers Surplus Travel & Tourism Market Applications HA 141 Dr. Bill Carroll 1
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2 Law of Demand HA 141 Dr. Bill Carroll 2 Demand – The willingness and ability of buyers to purchase different quantities of a good or service at different prices during a specified time period. Law of Demand – As the price of a good or service rises, the quantity demanded of that good or service falls, and as the price of the good or service falls, the quantity demanded of that good or service rises, ceteris paribus.
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3 Absolute vs. Relative Prices HA 141 Dr. Bill Carroll 3 Good Price CD $8 Beer $2 Absolute price of a CD: $8 Relative price of a CD: 4 beers
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4 Demand HA 141 Dr. Bill Carroll 4 Price Quantity Inverse relationship Diminishing marginal utility D
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5 Utility HA 141 Dr. Bill Carroll 5 Utility – The satisfaction or benefit that results from the consumption of a good or service. Total Utility – The total satisfaction or benefit that a person receives from consuming a particular good or service . Marginal Utility – The additional utility a person receives from consuming or enjoying an additional amount of a particular good or service .
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6 Marginal Utility HA 141 Dr. Bill Carroll 6 Diminishing Marginal Utility
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Topic_3__Supply_and_Demand - Supply and Demand Demand...

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