Chapter_3_Supply_and_Demand_Curves_-_Econ - Chapter 3 Supply and Demand Curves \u25cf Supply and demand model is the core of microeconomics \u25cf Quantity is

Chapter_3_Supply_and_Demand_Curves_-_Econ - Chapter 3...

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Chapter 3 - Supply and Demand Curves Supply and demand model is the core of microeconomics Quantity is on the x axis and price is on the y Demand curve Demand curve is consumer behavior Quantity demanded is the amount of a good that consumers are willing to buy at any given price As the price falls the quantity demanded increases To find the demand curve you find how much a consumer is willing to buy at different prices and then graph them and connect the dots Consumer surplus is difference between willingness to pay for a given product and what they actually pay Can never be negative If the price is more than you are willing to pay then you don’t have to buy the good Consumer surplus is the area above the price that buyers pay and below the demand curve (normally the triangle) Price and consumer surplus are opposites (ex price down surplus up) Changes in the demand curve Income If it is a normal good, when people’s income goes up there is likely to be more sales of the good (ex. Bigger house, nicer cars)
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