ECO101H1 Lecture 5: Demand Supply and Market Price

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Many buyers and sellers, each of whom has no influence on market price (ex. coffee) Other things equal , the higher the price of a good, the lower the quantity demanded. Market demand curve: sum of individual demand curves (at each possible price, sum the quantities demanded by each individual) (individual demand curve - jane) A change in quantity demanded (as the price of the good changes) is a movement along the demand curve. A change in demand (for a given price) is a shift in the demand curve. Demand curves will shift as a result of changes in. Substitutes: used instead of , such as tea and coffee. Complements: used together , such as coffee and cream. Shift in demand curve for ice cream cones. #2 sharp drop in price of yogurt cones (substitute) Law of upward-sloping supply : other things equal , the higher the price of a good, the higher the quantity supplied.

Related Questions

The market demand curve

a. slopes upward.

b. is found by vertically adding the individual demand curves.

c. represents the sum of the quantities demanded by all the buyers at each price of the good.

d. represents the sum of the prices that all the buyers are willing to pay for a given quantity of the good.

When we move along a given demand curve,

all nonprice determinants of demand are held constant.

only price is held constant.

all determinants of quantity demanded are held constant.

d. income and price are held constant.

When the price of a good or service changes,

	a.	there is a movement along a given demand curve.
	b.	the demand curve shifts in the opposite direction.
	c.	the supply curve shifts in the opposite direction.
	d.	the demand curve shifts in the same direction.

Using supply and demand analysis, describe the effect of each of the following events on the market for coffee: Your description should include which curve shifts, supply or demand, which way the curve shifts, left or right, if the equilibrium price increases or decreases and if the equilibrium quantity increases or decreases.

a. Brazil has an excellent harvest of coffee beans.

b. Daily drinking of tea is discovered to prevent cancer, dementia and arthritis.

c. The price of cream, milk and cream substitutes decrease.

d. Drinking coffee daily is shown to reduce weight.

e. The cost of transporting coffee beans increases.

goldgoat200

Use the figure below to answer the following questions. Table 3.5.2 Demand and Supply Schedules for Cups of Coffee each day at CoolU Quantity Demanded (cups of coffee per day) 1,200 Quantity Supplied (cups of coffee per day) 0 1,100 Price (dollars per cup) 0.70 0.80 0.90 1.00 1.10 1.20 1,000 900 800 200 400 600 800 1,000 1,200 1,400 1,600 700 600 500 1.30 1.40 1.50 400 35) Refer to Table 3.5.2. A premature frost destroys half the coffee trees. This change would be represented as a A) rightward shift of the demand curve. B) leftward shift of the supply curve. C) movement down along the supply curve. D) rightward shift of the supply curve. E) leftward shift of the demand curve.

ECO101H1 Lecture 5: Demand Supply and Market Price

ECO101H1 Full Course Notes

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