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Econ 202 Sept 20th - influence on the market price...

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Fall in input prices makes production more profitable=shift curve to the right A cost saving technological improvement has the same affect as fall in input prices Increase in the number of the sellers than more of the good will be produced a shift in the supply curve occurs when a non price determinant of supply changes like technology or costs Change in quantity supplied: a movement along a fixed S curve, occurs when P changes Change sin Demand: Occurs when a non price determinant of demand changes like income of # of buyers A competitive market has many buyers and sellers each of whom has little or no
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Unformatted text preview: influence on the market price Economists use the supply and demand model to analyze competitive markets GDP measures total income of everyone in the economy also total expenditure of the economy output of g&s Income equals expenditure GDP Consumption, Investment,Government Purchases, Net Exports y=c + i + g +nx D increases = Price and Quantity increase D decreases = Price and Quantity decrease S increases = Price decreases and Quantity increases S decreases = Price increases and quantity decreases...
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