Chapters+3++9-29-2006+

Chapters+3++9-29-2006+ - (9-29-2006)1Chapter 3Supply and...

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Unformatted text preview: (9-29-2006)1Chapter 3Supply and DemandUCI Fall 2006Economics 1Instructor: Soheila Crane(9-29-2006)2What is a market?A market exists where an exchange takes placeExamples?LEGALILEGALREGULATEDWhat determines the price of a product?Does the price of a product impact its production or consumption?Why do prices and production levels change?(9-29-2006)3Who are market participants?Individuals/householdsBusinessesGovernment agencies(9-29-2006)4What are the goals of consumers to participate in a market?What are the goals of businesses/producers to participate in a market?What are the goals of government agencies?Consumer goals maximize their happinessProducers goals maximize profitsGovt agencies maximize general welfareWhy participate in a market? (9-29-2006)5Why tradeoffs are necessary?Why cant all market participants attain everything they desire?Limited resources ---- constraints(9-29-2006)6Specialization and ExchangeWe cannot produce everything we consume!Even if we could produce all we consume, it would make more sense (it is more efficient) to specialize and engage in trade (9-29-2006)7Market InteractionsProduct marketsFactor marketsForeign market participantsForeign market participants(9-29-2006)8Supply and DemandEvery market transaction involves an exchange --- Someone selling/supplying a productSomeone buying/demanding a product(9-29-2006)...
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This note was uploaded on 02/12/2010 for the course ECON 62000 taught by Professor Freed during the Spring '07 term at UC Irvine.

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Chapters+3++9-29-2006+ - (9-29-2006)1Chapter 3Supply and...

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