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ECON 1P91 Lecture Notes - Demand Curve, Perfect Competition, Inferior Good

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rachelxmckenna
4 May 2022
School
Brock University
Department
Economics
Course
ECON 1P91
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ECON 1P91 Full Course Notes
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Document Summary

Supply and demand are 2 words used by economist: they are what make market economies work, they determine the quantity of each good produced and the price at which it is sold. If you want to know how any event or policy will affect the economy, you must think first about how it will affect supply and demand: refers to the behavior of people when interacting in competitive markets. Market: a group of buyers and sellers of a particular good or service: buyers as a group determine the demand for the product, sellers as a group determine the supply of the product. Monopoly: only seller in the market and they set the price. Quantity demanded: the amount of a good that buyers are willing and able to purchase. Law of demand: the claim that, other things equal, the quantity demanded of a good falls when the price of the good rises.

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Related Questions

A competitive market is one in which:

a. is only one seller, but many buyers. 

b. are many sellers, and each has the ability to set the price of his product. 

c. are many sellers and compete with one another in such a way that some sellers are always being forced out of the market. 

d. are so many buyers and so many sellers that each has a negligible impact on the price of the product. 

1. In a competitive market, the quantity of a product produced and the price of the product are determined by

a. buyers.

b. sellers.

c. both buyers and sellers.

d. None of the above is correct.

 

2. Which of the following statements is correct?

a. Buyers determine supply and sellers determine demand.

b. Buyers determine demand and sellers determine supply.

c. Buyers determine both demand and supply

d. Sellers determine both demand and supply

 

3. The demand for a good or service is determined by

a. those who buy the good or service

b. the government.

c. those who sell the good or service.

d. both those who buy and those who sell the good or service.

 

4. An increase in supply is represented by

a. a movement downward and to the left along a supply curve.

b. a movement upward and to the right along a supply curve.

c. a rightward shift of a supply curve.

d. a leftward shift of a supply curve

Markets explained on the basis of supply and demand:

A. assume many buyers and many sellers of a standardized product.

B. assume market power so that buyers and sellers bargain with one another.

C. does not exist in the real-world economy.

D. are approximated by markets in which a single seller determines the price.