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Unformatted text preview: Notes 4/5/10 Supply and demand o Indirect exchange use money as an intermediate good. Dont need to barter. o How to determine prices? Supply and demand o Demand curve p. 211 o Price on vertical axis o Quantity demand on horizontal axis o More demand at lower price, of course o This is a schedule of consumer intentions Supply and demand o Supply curve p. 212 o Price on vertical axis (same as demand curve) o Amount supplied on horizontal axis o More supply at higher price of course o A schedule of producer intentions Supply and demand o Put both curves on same graph p. 213 o Intersection point is equilibrium: consumer and producer are satisfied. Unique point o Can increase demand, eg w advertising Moves demand curve to right p. 214 Can lower demand, moving curve to left o Can increase supply at a given price, eg w automation. Supply curve to right p. 215 Supply and demand o Price support: govt guarantees a price by buying surplus to keep the price high...
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This note was uploaded on 02/07/2011 for the course COMM 402 taught by Professor Hample during the Spring '10 term at Maryland.
- Spring '10