80PART TWOSUPPLY AND DEMAND I: HOW MARKETS WORKQUICK QUIZ:List the determinants of the quantity of pizza supplied.±Make up an example of a supply schedule for pizza, and graph the implied supply curve.±Give an example of something that would shift this supply curve.±Would a change in the price of pizza shift this supply curve?SUPPLY AND DEMAND TOGETHERHaving analyzed supply and demand separately, we now combine them to seehow they determine the quantity of a good sold in a market and its price.EQUILIBRIUMFigure 4-8 shows the market supply curve and market demand curve together.Notice that there is one point at which the supply and demand curves intersect;this point is called the market’s equilibrium.The price at which these two curvescross is called the equilibrium price,and the quantity is called the equilibriumquantity.Here the equilibrium price is $2.00 per cone, and the equilibrium quan-tity is 7 ice-cream cones.
This is the end of the preview. Sign up
access the rest of the document.
This note was uploaded on 07/30/2010 for the course ECON 120 taught by Professor Abijian during the Spring '10 term at Mesa CC.