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Lecture 3

# ECON 101 Lecture Notes - Lecture 3: Ceteris Paribus, Inverse Relation, Marginal Utility

Department
Economics
Course Code
ECON 101
Professor
Robert Gateman
Lecture
3

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Lecture 3: Chapter 3 (Chapter 2 not in lecture)
Demand
Demand is basically the same as Supply, simply switch the D’s and
S’s
Definition of Demand
o Qd=Quantity demanded; quantity consumer wants to
purchase, given price of object, ceteris paribus
You do not know quantity bought, only quantity
demanded (If price is ___ how much will you buy?)
o Ceteris Paribus: Every other variable remains constant
o Qd=dependant variable
o Price = independent variable
o Ceteris Paribus = controlled variable
o Demand = Function DO NOT CONFUSE WITH QD
1.2
**Critical Thinking Moment
o If price is less, how much would you buy? **Why??
o As price drops, so does opportunity cost because you are
paying less money for same product
o As price drops, desire to buy goes up (Inverse relationship
between price and demand
How to pass ECON according to Gateman
o Take deep breath
o Remind yourself life is short
o Define the question and its variables
Gateman Notes
Underlined variables means said variable is held constant (only a
Gateman thing)
Demand function
o Qd = f(P) is essentially x = f(y)