ECON 101 Lecture Notes - Lecture 29: Market Clearing, Ceteris Paribus, Demand Curve
Document Summary
All individuals" buying behaviours combine to create a market. The sum of all individual demand results in the market demand for a product (or service). Used to explain how individuals make choices. An individual consumer faces a price rise in the product they consume. Response: consume less (move upward and to the left along the demand curve. Change in supply or demand when something other than price changes. As the price of a product increases and assuming ceteris paribus, producers will supply more. *there is an upward sloping (positive) relationship between price and quantity supplied. A change in price results in a movement along the supply curve. Supply in economics is represented as a relationship between price and quantity supplied. Some firms will be able to produce different quantities of a product or service for the same price. All individual producers" quantities supplied add to create a market supply for a product or service.