Lecture Business economics - Lecture 3: Market forces of supply and demand - II. The following will be discussed in this chapter: Supply curve, market supply vs. individual supply, shifts in supply curve, equilibrium analysis. | Review of the previous Lecture Economists use the model of supply and demand to analyze competitive markets. In a competitive market, there are many buyers and sellers, each of whom has little or no influence on the market price. The demand curve shows how the quantity of a good depends upon the price. According to the law of demand, as the price of a good falls, the quantity demanded rises. Therefore, the demand curve slopes downward. In addition to price, other determinants of how much consumers want to buy include income, the prices of complements and substitutes, tastes, expectations, and the number of buyers. If one of these factors changes, the demand curve shifts. Lecture 3 Market forces of supply and demand - II Instructor: Abbas Course code: ECO 400 Lecture Outline Supply curve Market supply vs. individual supply Shifts in supply curve Equilibrium analysis Supply Quantity supplied is the amount of a good that sellers are willing and able to sell. Law of Supply | Review of the previous Lecture Economists use the model of supply and demand to analyze competitive markets. In a competitive market, there are many buyers and sellers, each of whom has little or no influence on the market price. The demand curve shows how the quantity of a good depends upon the price. According to the law of demand, as the price of a good falls, the quantity demanded rises. Therefore, the demand curve slopes downward. In addition to price, other determinants of how much consumers want to buy include income, the prices of complements and substitutes, tastes, expectations, and the number of buyers. If one of these factors changes, the demand curve shifts. Lecture 3 Market forces of supply and demand - II Instructor: Abbas Course code: ECO 400 Lecture Outline Supply curve Market supply vs. individual supply Shifts in supply curve Equilibrium analysis Supply Quantity supplied is the amount of a good that sellers are willing and able to sell. Law of Supply The law of supply states that, other things equal, the quantity supplied of a good rises when the price of the good rises. The Supply Curve: The Relationship between Price and Quantity Supplied Supply Schedule The supply schedule is a table that shows the relationship between the price of the good and the quantity supplied. . Ahmad’s supply chart is following Supply Supply Curve The supply curve is the graph of the relationship between the price of a good and the quantity supplied. Supply Market Supply versus Individual Supply Market supply refers to the sum of all individual supplies for all sellers of a particular good or service. Graphically, individual supply curves are summed horizontally to obtain the market supply curve. Shifts in the Supply Curve Variables that cause supply shifts Input prices Technology Expectations Number of sellers Change in Quantity Supplied Movement along the supply curve. Caused by a change in anything that alters the quantity supplied at each price. .
