ECO101H1 Lecture Notes - Lecture 5: Economic Equilibrium, Demand Curve, Substitute Good

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ECO101H1 Full Course Notes
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ECO101H1 Full Course Notes
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Demand, supply and market price: demand curve a. Individual demand curve: movement along vs shift, supply curve a. Law of upward-sloping supply: market vs. firm supply curve, movement along vs. Shift: equilibrium (price, quantity) in competitive market, how equilibrium is determined, examples. Competitive market demand and supply only applies to this market. Many buyers and sellers, each of whom has no influence on market price. Example: coffee (no single buyer or seller can influence the price) Other things equal (cetirus paribus), the higher is the price of a good, the lower is the quantity demanded. Market demand curve how it interacts with market supply. *refer to market demand curve (jane, john, and jane + john) Market demand curve: sum of individual demand curves (at each possible price, sum the quantities demanded by each individual -> add up q. d. for each price for all individuals) Substitutes goods (used instead of, such as tea and coffee) a. ii.

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