supply and demand curves. law of demand and demand curve law of demand= relationship between the...
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![Page 1: Supply and Demand Curves. Law of Demand and Demand Curve Law of Demand= Relationship between the quantity demanded and price is inverse. (They move](https://reader036.vdocument.in/reader036/viewer/2022071714/5697bffa1a28abf838cc081a/html5/thumbnails/1.jpg)
Supply and Demand Curves
![Page 2: Supply and Demand Curves. Law of Demand and Demand Curve Law of Demand= Relationship between the quantity demanded and price is inverse. (They move](https://reader036.vdocument.in/reader036/viewer/2022071714/5697bffa1a28abf838cc081a/html5/thumbnails/2.jpg)
Law of Demand and Demand Curve
Law of Demand= Relationship between the quantity demanded and price is inverse. (They move in opposite directions) As price increases, demand decreases.
As Price decreases, demand increases.
![Page 3: Supply and Demand Curves. Law of Demand and Demand Curve Law of Demand= Relationship between the quantity demanded and price is inverse. (They move](https://reader036.vdocument.in/reader036/viewer/2022071714/5697bffa1a28abf838cc081a/html5/thumbnails/3.jpg)
Quantity Demanded and Demand
Change in “quantity demanded” causes movement along the same demand curve.
Change in demand causes the entire demand curve to shift to the right or left. Right=Increase Change in
Demand ↓
Left=Decrease
![Page 4: Supply and Demand Curves. Law of Demand and Demand Curve Law of Demand= Relationship between the quantity demanded and price is inverse. (They move](https://reader036.vdocument.in/reader036/viewer/2022071714/5697bffa1a28abf838cc081a/html5/thumbnails/4.jpg)
Determinants of Demand(Cause a shift in Demand Curve)
Change in population
Change in Income
Change in Taste/Preference
Substitute Goods
Complementary Goods
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Elasticity of Demand
A rise or fall in the price of a good greatly affects the amount people are willing to buy. What are some examples of goods that have an elastic demand?
Toilet Paper?
Hot Dogs?
![Page 6: Supply and Demand Curves. Law of Demand and Demand Curve Law of Demand= Relationship between the quantity demanded and price is inverse. (They move](https://reader036.vdocument.in/reader036/viewer/2022071714/5697bffa1a28abf838cc081a/html5/thumbnails/6.jpg)
Inelastic Demand
Price change doesn’t greatly affect quantity demanded. Gas- no matter the price, people still need gas.
Electricity
Anything that is essential to every day life most generally is inelastic.
![Page 7: Supply and Demand Curves. Law of Demand and Demand Curve Law of Demand= Relationship between the quantity demanded and price is inverse. (They move](https://reader036.vdocument.in/reader036/viewer/2022071714/5697bffa1a28abf838cc081a/html5/thumbnails/7.jpg)
Law of Supply and Supply Curve
Law of supply= There is a direct relationship between price and quantity supplied. Price rises=quantity supplied rises
Price falls=quantity supplied falls
Incentive of greater profits causes the production of more goods. (Increase in supply)
Supply curve- shows the quantity supplied at each possible price.
![Page 8: Supply and Demand Curves. Law of Demand and Demand Curve Law of Demand= Relationship between the quantity demanded and price is inverse. (They move](https://reader036.vdocument.in/reader036/viewer/2022071714/5697bffa1a28abf838cc081a/html5/thumbnails/8.jpg)
Supply Curve
Change in “quantity supplied”- caused by a change in price and is shown as movement along the supply curve.
Change in supply- producers supply more or fewer goods at every possible price. (Shifts entire supply curve) These shifts are cause by determinants of supply which are:
Price of Inputs/Cost of Production
Number of businesses in the industry
Taxes on businesses
Technology (better/faster production)
![Page 9: Supply and Demand Curves. Law of Demand and Demand Curve Law of Demand= Relationship between the quantity demanded and price is inverse. (They move](https://reader036.vdocument.in/reader036/viewer/2022071714/5697bffa1a28abf838cc081a/html5/thumbnails/9.jpg)
Change in “quantity supplied” vs change in Supply
Both curves show an increase.
![Page 10: Supply and Demand Curves. Law of Demand and Demand Curve Law of Demand= Relationship between the quantity demanded and price is inverse. (They move](https://reader036.vdocument.in/reader036/viewer/2022071714/5697bffa1a28abf838cc081a/html5/thumbnails/10.jpg)
Supply and Demand Together
Equilibrium Price- quantity supplied by sellers is the same as quantity demanded by consumers.
Shortage- quantity supplied is less than the quantity demanded. (Not enough goods to satisfy wants/needs)
Surplus- quantity supplied exceeds quantity demanded. (Goods left over because demand wasn’t great enough)