LectureAssignment02

LectureAssignment02 - 1 ECONOMICS 100 Lecture Assignment #2...

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ECONOMICS 100 Lecture Assignment #2 (Supply and Demand) Source: LR 11, Chapter 3 and Chapter 5, to page 103; LR10, Chapter 3, and Chapter 5, to page 105. 1. Generating Demand and Supply 1.1 What are the determinants of the quantity demanded of good X (in a given time period)? 1.2 What are the determinants of the quantity supplied of good X (in a given time period)? 1.3 An aside on economic constructs: How do the concepts of stocks , flows , inflation and relative prices fit into the above analysis? 2. A Numeric Example of Supply and Demand Below are data on the aggregate demand and supply information in the market for C's in units per month: Quantity Demanded Price Quantity Supplied (\$) 8 10 20 10 8 16 12 6 12 14 4 8 16 2 4 2.1 Why does quantity demanded rise and quantity supplied fall as the price falls? i.e., What explains the slopes of the Supply and Demand Curves/Schedules? 2.2 What is the equilibrium price and equilibrium quantity? 2.3 What does the word equilibrium mean in this context? 2.4 What would happen if the price was temporarily above or below the level you computed in part 2.2? In other words, what are the equilibriating forces? Note: The Algebra of Market Equilibrium, LR11 page 68 is interesting and helpful, but you do not need to memorize the formulae! 1

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3. The "Laws" of Supply and Demand 3.1 What are the "Laws" of Supply and Demand ? 3.2
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This note was uploaded on 08/24/2010 for the course ECO 100 taught by Professor Indart during the Fall '08 term at University of Toronto.

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LectureAssignment02 - 1 ECONOMICS 100 Lecture Assignment #2...

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