Chapter 2 - Demand and supply, after this chapter, you will be able to: Describe the nature of demand, changes in quantity demanded, changes in demand, and the factors that affect demand; summarize the nature of supply, changes in quantity supplied, changes in supply, and the factors that affect supply; explain how markets reach equilibrium-the point at which demand and supply meet. | Understanding Economics 2nd edition by Mark Lovewell and Khoa Nguyen Chapter 2 Demand and Supply Copyright © 2002 by McGraw-Hill Ryerson Limited. All rights reserved. Copyright © 2002 by McGraw-Hill Ryerson Limited. All rights reserved. What Is Demand? Demand is a relationship between a product’s price and quantity demanded. Demand is shown using a schedule or curve. The law of demand states that price and quantity demanded are inversely related. Market demand is the sum of quantities demanded by all consumers in a market. * 1 The Demand Curve 0 1 3 5 7 9 11 13 Quantity Demanded (millions of kg per year) Market Demand Curve for Strawberries Market Demand Schedule for Strawberries Quantity Demanded (millions of kg) Point on graph Price ($ per kg) 9 7 11 Price ($ per kg) D b a c a b c Copyright © 2002 by McGraw-Hill Ryerson Limited. All rights reserved. * 3 Deriving Market Demand Figure , page 31 0 1 2 3 4 5 6 7 Quantity Demanded (kg per . | Understanding Economics 2nd edition by Mark Lovewell and Khoa Nguyen Chapter 2 Demand and Supply Copyright © 2002 by McGraw-Hill Ryerson Limited. All rights reserved. Copyright © 2002 by McGraw-Hill Ryerson Limited. All rights reserved. What Is Demand? Demand is a relationship between a product’s price and quantity demanded. Demand is shown using a schedule or curve. The law of demand states that price and quantity demanded are inversely related. Market demand is the sum of quantities demanded by all consumers in a market. * 1 The Demand Curve 0 1 3 5 7 9 11 13 Quantity Demanded (millions of kg per year) Market Demand Curve for Strawberries Market Demand Schedule for Strawberries Quantity Demanded (millions of kg) Point on graph Price ($ per kg) 9 7 11 Price ($ per kg) D b a c a b c Copyright © 2002 by McGraw-Hill Ryerson Limited. All rights reserved. * 3 Deriving Market Demand Figure , page 31 0 1 2 3 4 5 6 7 Quantity Demanded (kg per month) Your Friend’s Demand Curve for Strawberries Individual and Market Demand Schedules for Strawberries You (D0) Price ($ per kg) 1 2 3 2 3 4 3 5 7 Price ($ per kg) Your Friend (D1) Market (Dm) (kg per month) 0 1 2 3 4 5 6 7 Quantity Demanded (kg per month) Market Demand Curve for Strawberries Price ($ per kg) 0 1 2 3 4 5 6 7 Quantity Demanded (kg per month) Your Demand Curve for Strawberries Price ($ per kg) D0 D1 Dm Copyright © 2002 by McGraw-Hill Ryerson Limited. All rights reserved. * 3 Copyright © 2002 by McGraw-Hill Ryerson Limited. All rights reserved. Changes in Demand (a) Changes in demand: are shown by shifts in the demand curve are caused by changes in demand determinants * 2 Changes in Demand (b) Figure , page 32 0 1 3 5 7 9 11 13 Quantity Demanded (millions of kg per year) Market Demand Curve for Strawberries Market Demand Schedule for Strawberries Quantity Demanded (millions of kg)
