Output demand supply supply equilibrium change of

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: d Supply Supply Equilibrium Change of Equilibrium 5 2/1/2011 10:22 AM Market Equilibrium When price is at its equilibrium, quantity demanded equals quantity supplied When p = p* , qD = qS Use Schedules Demand Supply Equilibrium Equilibrium 50 ¢ 8,000 0 5,000 1,000 3,000 3,000 $3.00 1,000 4,500 $4.00 Change of Equilibrium quantity supplied $2.00 Equilibrium price: p* Equilibrium quantity: q* quantity demanded $1.00 Notation price 500 5,000 Demand Use Curves Supply Equilibrium Equilibrium Change of Equilibrium Adjustment Process If p < p* Demand Supply Equilibrium Equilibrium Change of Equilibrium Demand Supply Equilibrium Equilibrium Change of Equilibrium 6 2/1/2011 10:22 AM Adjustment Process If p > p* Demand Change of Equilibrium Δ Demand or Δ Supply occurs when a "ceteris paribus" assumption is violated Supply Equilibrium Equilibrium Change of Equilibrium Demand Example Demand Supply Equilibrium Supply Equilibrium Change of Equilibrium Change of Equilibrium Example Change of Equilibrium Change of Equilibrium Demand Supply Equilibrium Change of Equilibrium Change of Equilibrium 7...
View Full Document

This note was uploaded on 09/11/2012 for the course ECON 1 taught by Professor Martholney during the Spring '08 term at University of California, Berkeley.

Ask a homework question - tutors are online