Lecture 5 slides notes

Lecture 5 slides notes - September ECON 1000 Fall 2009...

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Lecture 06 29 September ECON 1000 Fall 2009 Cohen 1 E C O N O M I C S PARKIN BADE Lecture 5 24 September 2009 Supply Market Supply Curve aggregation of all individual firm supply curves relation between price ( P ) and quantity supplied ( Q S ) 15 20 10 5 Q 0 0.50 1.00 1.50 2.00 2.50 3.00 P 25 Figure 3.4 The Supply Curve Supply A E D C B .
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29 September ECON 1000 Fall 2009 Cohen 2 Supply Law of supply — P quantity supplied, ceteris paribus movement along the supply curve Why does supply curve slope up to right? P profitability P willingness to supply goods with higher opportunity costs (higher marginal costs) continued Supply Ceteris paribus assumptions for supply curve technology unchanged number suppliers unchanged expected future prices unchanged prices of factors of production unchanged prices related goods produced unchanged state of nature unchanged Shift of supply curve called change in supply
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Lecture 5 slides notes - September ECON 1000 Fall 2009...

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