ECO100Y1 Lecture : eco lec
Document Summary
Many buyers and sellers" each of who has no influence on market price. Other things equal, the higher is price of a good, the lower is the quantity demanded. Market demand curve: sum of individual demand curves (at each possible price, sun the quantities demanded by each individual) 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 sources of shifts in demand curves: price of related goods, substitutes, complements. Will the demand of the coffee shift if there is a reduction in the price of tea. Tea and coffee are substitutes (used is instead of) Result: a decrease in the demand for coffee. Other things equal, the higher is the price if a good, the higher is the quantitity supplied. Movement along a supply curve versus a shift in the supply.