ECON 105 Lecture Notes - Lecture 4: European Cooperation In Science And Technology, Marginal Cost, Opportunity Cost
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Demand: demand curve: relationship between price and quantity demanded (purchased, downward sloping, we want to model the response to changes in factors other than prices. Income: preferences, prices of goods, beliefs about future prices/income/preferences. We will model these as: change s in qd at a given p, demand curve shifts in from d0, example to d1. I get a raise (change in income: most goods are normal goods (higher-income people buy more, some good are inferior goods (higher-income people buy less, steak is a normal good. In addition, it shifts in response to changes in the number of buyers in the market: example: housing in vancouver. Supply: (sellers: we will think of the sellers as firms producing and selling goods, factors that affect quantity supplied by a firm, price, price goes up the more willing you will be to supply, cost.