Ch4 - (KDSWHU 9KH 2DUNHW +RUFHV DQG 8XSSO\ DQG )HPDQG In...

Info iconThis preview shows pages 1–11. Sign up to view the full content.

View Full Document Right Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: (KDSWHU 9KH 2DUNHW +RUFHV DQG 8XSSO\ DQG )HPDQG In this chapter, look for the answers to these questions: DKdW IdFWRUV dIIHFW EX\HUV GHPdQG IRU JRRGV$ DKdW IdFWRUV dIIHFW VHOOHUV VXSSO\ RI JRRGV$-RZ GR VXSSO\ dQG GHPdQG GHWHUPLQH WKH SULFH RI d JRRG dQG WKH TXdQWLW\ VROG$-RZ GR FKdQJHV LQ WKH IdFWRUV WKdW dIIHFW GHPdQG RU VXSSO\ dIIHFW WKH PdUNHW SULFH dQG TXdQWLW\ RI d JRRG$-RZ GR PdUNHWV dOORFdWH UHVRXUFHV$ 9-* 2&70*9 +47(*8 4+ 8<551@ &3) )*2&3) Markets and Competition & market LV D JURXS RI EX\HUV DQG VHOOHUV RI D SDUWLFXODU SURGXFW & competitive market LV RQH ZLWK PDQ\ EX\HUV DQG VHOOHUV HDFK KDV D QHJOLJLEOH HIIHFW RQ SULFH .Q D perfectly competitive PDUNHW &OO JRRGV H[DFWO\ WKH VDPH 'X\HUV VHOOHUV VR QXPHURXV WKDW QR RQH FDQ DIIHFW PDUNHW SULFH HDFK LV D price taker .Q WKLV FKDSWHU ZH DVVXPH PDUNHWV DUH SHUIHFWO\ FRPSHWLWLYH 9-* 2&70*9 +47(*8 4+ 8<551@ &3) )*2&3) Demand 9KH quantity demanded RI DQ\ JRRG LV WKH DPRXQW RI WKH JRRG WKDW EX\HUV DUH ZLOOLQJ DQG DEOH WR SXUFKDVH Law of demand WKH FODLP WKDW WKH TXDQWLW\ GHPDQGHG RI D JRRG IDOOV ZKHQ WKH SULFH RI WKH JRRG ULVHV RWKHU WKLQJV HTXDO 9-* 2&70*9 +47(*8 4+ 8<551@ &3) )*2&3) The Demand Schedule Demand schedule D WDEOH WKDW VKRZV WKH UHODWLRQVKLS EHWZHHQ WKH SULFH RI D JRRG DQG WKH TXDQWLW\ GHPDQGHG *[DPSOH-HOHQV GHPDQG IRU ODWWHV 5ULFH RI ODWWHV 6XDQWLW\ RI ODWWHV GHPDQGHG 3RWLFH WKDW -HOHQV SUHIHUHQFHV REH\ WKH 1DZ RI )HPDQG 9-* 2&70*9 +47(*8 4+ 8<551@ &3) )*2&3) Price of Lattes Quantity of Lattes Helens Demand Schedule Curve 5ULFH RI ODWWHV 6XDQWLW\ RI ODWWHV GHPDQGHG Market Demand versus Individual Demand 9KH TXDQWLW\ GHPDQGHG LQ WKH PDUNHW LV WKH VXP RI WKH TXDQWLWLHV GHPDQGHG E\ DOO EX\HUV DW HDFK SULFH 8XSSRVH -HOHQ DQG 0HQ DUH WKH RQO\ WZR EX\HUV LQ WKH 1DWWH PDUNHW 6 I " TXDQWLW\ GHPDQGHG -HOHQV 6 I 0HQV 6 I " " " " " " " 2DUNHW 6 I 5ULFH 9-* 2&70*9 +47(*8 4+ 8<551@ &3) )*2&3) 6 The Market Demand Curve for Lattes 6 I 2DUNHW 9-* 2&70*9 +47(*8 4+ 8<551@ &3) )*2&3) Demand Curve Shifters 9KH GHPDQG FXUYH VKRZV KRZ SULFH DIIHFWV TXDQWLW\ GHPDQGHG otOLr tOPnNs ILPnN LquHS 9KHVH RWKHU WKLQJV DUH QRQSULFH GHWHUPLQDQWV RI GHPDQG PL WKLQJV WKDW GHWHUPLQH EX\HUV GHPDQG IRU D JRRG RWKHU WKDQ WKH JRRGV SULFH (KDQJHV LQ WKHP VKLIW WKH 5 FXUYH 9-* 2&70*9 +47(*8 4+ 8<551@ &3) )*2&3) Demand Curve Shifters: of Buyers .QFUHDVH LQ RI EX\HUV LQFUHDVHV TXDQWLW\ GHPDQGHG DW HDFK SULFH VKLIWV 5 FXUYH WR WKH ULJKW 9-* 2&70*9 +47(*8 4+ 8<551@ &3) )*2&3)...
View Full Document

This note was uploaded on 03/22/2011 for the course ECON 200 taught by Professor Ta during the Spring '07 term at University of Washington.

Page1 / 63

Ch4 - (KDSWHU 9KH 2DUNHW +RUFHV DQG 8XSSO\ DQG )HPDQG In...

This preview shows document pages 1 - 11. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online