AGEC 315 Lecture Notes - Lecture 1: Marginal Utility, Food Politics, Demand Curve
5 Sep 2018
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C(cid:28667)apt(cid:28664)r (cid:28612) (cid:28613) (cid:28614) (cid:28617) (cid:28603)hav(cid:28664) to (cid:28663)o t(cid:28667)(cid:28664) r(cid:28664)a(cid:28663)(cid:28668)n(cid:28666), t(cid:28667)at"s ass(cid:28668)(cid:28666)nm(cid:28664)nt(cid:28604) Reading materials are expected to do before exam 1. Best match supply and demand means competitve advantage_ challenge. Law of demand when the price goes up, quantity decreased. = the benefit 1 derive from the 2nd peach is lower the 1st peach and so on. Own price elasticity : sensitivity of demand to price changes. E= dq/dp = (q2- q1/ q average)/ (p2-p1 / p average) Demand response to fed prices is typically elastic. As we aggregated to higher levels, it gets complicated, but it may mean we are simplifying. = price can not shift the demand curve (change in price is movement along the demand curve) Tastes and preferences gluten-free food skyrockets. Complement cross-price elasticity : sensitivity of demand in changes in other prices ecp= dq/d(p of other) ~ negative. Law of supply : when p goes up, quantity supplied increase.
