ECON 2100 Lecture Notes - Lecture 3: Ceteris Paribus, Demand Curve, Carpool

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31 Aug 2016
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Chapter 4-the market forces of supply and demand. A competitive market is one with many buyers and sellers; each has a negligible effect on price. A perfectly competitive market: all goods exactly the same. There are so many buyers and sellers that no one can affect the market price-each is a price taker . The quantity demanded of any good is the amount of the good that buyers are willing and able to purchase. Law of demand- the claim that the quantity demanded of a good falls when the price of a good rises, other things equal. Demand schedule- a table that shows the relationship between the price of a good and the quantity demanded, ceteris paribus. The demand schedule is helpful to a business and its production because they can gauge whether the marketing price of the item is too high or too low. For example, the higher the price of gas, the lower quantity demanded.

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