Week 1 Discussion Supply and Demand

Week 1 Discussion Supply and Demand - consumer increases...

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I originally found this question a bit confusing. As stated in our notes for this week the Law of Demand is defined by the principle that when the quantity demanded by the consumer goes up, the price also goes up and vice versa. Therefore it would appear that a change in demand and a change in quantity demanded would be the same. However in doing some more reading and research I found that a change in quantity demanded is directly related to price. A change in the demanded quantity basically occurs as a consumer’s reaction to changes in price of goods or services. A change in demand is an increase or decrease in demand that is caused by changes other than price such as a change in consumer’s income, tastes, and the price of substitutes. Turning to our slides again, the Law of Supply states that as the quantity supplied to the
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Unformatted text preview: consumer increases, the price decreases and vice versa. Changes in quantity supplied are caused by changes in cost to the suppliers. However, changes in supply can be caused by a several different factors other than cost such as a change in technology that makes production become more effective and lowering costs. A change in supply could also be cause by the number of competitors in that market. Sources: http://wiki.answers.com/Q/Difference_between_change_in_demand_and_quantity_demand http://en.wikipedia.org/wiki/Supply_and_demand http://www.emcp.com/product_catalog/resourcefile.php?ID=1494 http://www.investopedia.com/terms/c/change_in_supply.asp http://www.cals.ncsu.edu/course/are012/readings/demand.html Posted: 07-07-09 1:20pm...
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This note was uploaded on 03/26/2012 for the course ECON GM545 taught by Professor Gotches during the Summer '11 term at Keller Graduate School of Management.

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