ECO 1102 Lecture 5: ECO1102 Chapter 4

• School: University of Ottawa
• Department: Economics
• Course: ECO 1102
• Professor: Octavian Strimbu

Document Summary

Eco1102, chapter 4: the market forces of supply. Supply and demand are the two words that economists use most often. Supply and demand are the forces that make market economies work: they determine the quantity of each good produced and the price at which it is sold. If you want to know how any event or policy will affect the economy, you must think first about how it will affect supply and demand. Market: a group of buyers and sellers of a particular good or service. Competitive market: a market in which there are many buyers and many sellers so that each has a negligible impact on the market price. Demand, we begin our study of markets by examining the behavior of buyers. Figure 4. 1: catherine"s demand schedule and demand curve. Market demand: the sum of all the individual demands for a particular good or service. Figure 4. 2: market demand as the sum of individual demands.