ECON101 Lecture Notes - Lecture 3: Inferior Good, Ceteris Paribus, Relative Price

• School: University of Waterloo
• Department: Economics
• Course: ECON101
• Professor: wokiakumase

Document Summary

In a monopolistic market, there is only one seller and that seller determines the price. In a monopsony, there is only one buyer and that buyer determines the price. Competitive market a market that has many buyers and sellers, so no single buyer or seller can influence their choice. Money price the number of dollars that must be given up for an object. Demand curve: willingness and ability to pay is a measure of marginal benefit. Factors of demand: the prices of related goods, a substitute is a good that can be used in place for another good. If price for a substitute increases, demand for the good decreases. If price for a substitute decreases, demand for the good increases: a compliment if a good that is used in conjunction with another good. If price of a compliment increases, demand of the good decreases. If price for a compliment decreases, demand for the good increases: expected future prices.