ECO 2023 Lecture Notes - Lecture 3: Demand Curve
10 Sep 2016
School
Department
Course
Professor
Document Summary
Resources: land, labor, capital o entrepreneurship. A ppf can expand or recede based on economic growth or recession. In a traditional market, the buyers (demanders) and sellers (suppliers) come together to exchange goods and services and the market works out an optimal price and quantity of a product. For example, coca-cola and pepsi tend to dominate the market for soda. Other products that are more general such as clothes and the agricultural market are more competitive. As the price of a good increases, the quantity demanded goes down and conversely, as the price of a good decreases, the quantity demanded increases. In a nutshell: the price of a good and the quantity demanded of it have an inverse relationship. To clarify, as the cost of something rises, people are less willing to pay for it and vice versa. It is important to note the difference between demand and quantity demanded. Demand: the entire curve represented on the graph.
