MGMT 4A Lecture Notes - Lecture 5: Dynamite Entertainment, Demand Curve, Oryza Sativa
Document Summary
Mgmt 4a lesson 2, part 2: equilibrium and price effects of supply and demand curve shifts. Module 3: equilibrium and price effects of supply and demand curve shift. Where the two curves cross, it is where the equilibrium will be. An excess of the quantity supply over quantity demanded. Q2-q1 = surplus in the graph (inverted triangle above) Price set too high compared to quantity of demand. An excess of the quantity demanded in the market over the quantity supplied. Example: a drought hits a wheat market. What would happen to wheat and what would happen to rice (substitute for wheat). Bread supply would shift inward and price would increase. Rice supply would shift outward and price would increase. If the cost of rice increase, asian rice companies can use a hedge to protect the. Trick question because without more information we don"t know which affects the supply or demand.
