ECON 208 Chapter Notes - Chapter 5: Demand Curve, Deadweight Loss, Efficient-Market Hypothesis

76 views4 pages
selin.aksezgin and 39983 others unlocked
ECON 208 Full Course Notes
27
ECON 208 Full Course Notes
Verified Note
27 documents

Document Summary

Changes in one market affect other markets (feedback) Partial-equilibrium analysis: analysis of a single market in isolation, ignoring any feedbacks that may come from induced changes in other markets. General-equilibrium analysis: analysis of all the economy"s markets simultaneously, recognizing different markets" interactions. Small markets won"t cause major effects on other markets (use partial analysis) Governments sometimes fix the price that a product must be sold/bought in the domestic market (i. e. ma water crisis in boston, may 2010) In free markets: equilibrium price equates quantity demanded and quantity supplied. Government price controls are policies that attempt to hold the price at a disequilibrium value. Some controls hold the market price below its equilibrium value to create a shortage at the controlled price. Some controls hold the market price above its equilibrium value to create a surplus at the controlled price. Determining is irrelevant in a free market because supply/demand are self- regulating.

Get access

Grade+20% off
$8 USD/m$10 USD/m
Billed $96 USD annually
Grade+
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
40 Verified Answers
Class+
$8 USD/m
Billed $96 USD annually
Class+
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
30 Verified Answers

Related Documents

Related Questions