Ch.4_The Market FOrces of Supply and Demand

Ch.4_The Market FOrces of Supply and Demand - Supply...

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Chapter 4: The Market Forces of Supply and Demand Demand : (Schedule or Curve) shows the various amounts to purchase at a Series of Possible prices, during a given time. I. Determinants of Demand Changes in Demand 1. Tastes 2. Income 3. Number of Buyers 4. Price of Related Goods Page 1 of 12
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5. Expectations Old English P Y N T E
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II. Demand Schedule (Table Form) PRICE Quantity 1.00 0.80 0.60 0.40 0.20 0.10 Demand Curve
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Demand VS. Q.D. Change in Demand Change in Quantity Demanded Causes Change in Determinants Change in Own Price Graphically SHIFTS ↑Demand→Righ t ↓Demand→Left MOVEMENT Along the Demand curve LAW OF DEMAND : QD rises as Price falls and vice versa, Ceteris paribus Ceteris Paribus: holding all other things constant (all things the same) _________________________ III. Determinants of Supply 1. Price of Inputs 2. Expectations
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3. # of Sellers 4. Technology (productivity)
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Unformatted text preview: Supply Schedule (Table Form) PRICE Quantity 1.00 0.80 0.60 0.40 0.20 0.10 Supply Curve SUPPLY VS. Q.S. Change in Supply Change in Quantity Supplied Causes Change in Determinants Change in Own Price Graphically SHIFTS ↑Supply → Right ↓ Supply → Left MOVEMENT Along the Supply curve IV. A. Market Equilibrium Market Equilibrium _________ Equilibrium Price _________ Equilibrium Quantity _________ $ Q IV.B. Predicting Price Changes: 1. Does the event influence Supply or Demand 2. Does the Event ↑or ↓ Demand or Supply 3. What are the NEW Equilibrium Price and Quantity Example 1: P Q Example 2: P Sheer Inc Cupid Inc Q Example 3: Computers # of buyers Technology P Q V. From Individual Demand (S) Market Demand (S) Market Demand: sum of all the buyers in the market Price Q Q Q T $1.00 $0.50 $0.10...
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This note was uploaded on 12/05/2011 for the course ECON 101 taught by Professor Dezhbakhsh during the Fall '07 term at Emory.

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Ch.4_The Market FOrces of Supply and Demand - Supply...

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