FARE 1300 Lecture Notes - Lecture 13: Demand Curve, Rent Regulation, Natural Disaster
24 Nov 2017
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Supply and demand have a horizontal and vertical meaning. Demand is a relationship for something that final consumers have. Derived demand is the demand for factors of production. things that are used to make something else which eventually become consumer goods. The derived demand relationship is relatively flat which makes it relatively elastic. If you don"t buy the copper from sudbury smelters you can buy copper from other places. there is competition. No stores open to sell bottled water. The supply curve shifted to the vertical axis because there was no bottled water to buy. Demand shifted right, because there is no substitute, so the demand is high i. e no tap water. the old supply of water on the coast doesn"t exist anymore. Even at a price of a bottle there is no bottle. Someone inland brings a truck full of bottled water and sells it for .
