ECON 103 Chapter Notes - Chapter 10: Demand Curve, Deadweight Loss, Economic Equilibrium

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10. 1. 2 maximization for consumer is that they equated they marginal values with the price. 10. 1. 3 maximization for rms they equated their marginal cost with the price. 10. 1. 4 in equilibrium marginal value = marginal cost. 10. 1. 5 the prices is the amount of other valuable things forgone. 10. 2 if the price of a substitute for good 1 goes up, then the demand for good 1 will shift upward and to the right. 10. 2. 2 if the price of a complement goes up the demand of that good will shift down and to the left. 10. 2. 3 increases in demand lead to movements along the supply curve, an increased equilibrium price and an increased equilibrium quantity. 10. 2. 4 increase in supply lead to movements along the demand curve, an increased equilibrium quantity but a decreased in equilibrium price. 10. 2. 5 when demand and supply curves shift they cause changes in prices and quantity.

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