1.27.10 – Lecture Notes, Econ 201

1.27.10 – Lecture Notes, Econ 201 - -But...

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1.27.10 – Lecture Notes, Econ 201 Next Time: Elasticity. Read Chapter 5. Review of stuff that is in notes from 1.25.10 Change in Quantity Demanded = movement along the curve Change in Demand = shift in the curve Adam Smith Invisible hand. Mars is the biggest candy company. Snickers is #1. $/Bar French Jones Smith Laura Olivia ALL Supply .50 1 1 0 1 2 5 12 .40 1 2 1 1 2 7 12 .30 2 3 2 2 3 12 12 .20 3 5 4 3 5 20 12 .10 3 10 5 5 10 33 12 *Make a graph of this information. How can the price of snickers change? - Shocks/Shifts - Only if there is a change in supply or if there is a change in demand.
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Unformatted text preview: -But remember, we already know the list of reasons why supply and demand can change. Changes in demand can be caused by:-Changes in consumer incomes (normal good/inferior good)-Changes in the prices of substitutes-Changes in the prices of complements-Changes in tastes Changes in the supply can be caused by:-Changes in the prices of resources-Changes in technology Supply Shift:-Inverse relationship between supply shift and price....
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