RSM100Y1 Chapter Notes - Chapter 3: Demand Curve, Economic Equilibrium, Monetary Policy
Document Summary
Chapter 3 economic challenges facing contemporary business. 3. 1 microeconomics: the forces of demand and supply. Demand: the willingness and ability of buyers to purchase goods and services. Supply: the willingness and ability of sellers to provide goods and services. > demand curve: a graph of the amount of a product that buyers will purchase at different prices; typically slopes downward because lower prices attract larger purchases. > change in quantity demanded = movement along curve; change in overall demand = new demand curve. > supply curve: graph that shows the relationship between different prices and the amount of goods that sellers" will offer for sale, regardless of demand. > factors of production are needed to produce goods and services. > change in the cost or availability of any inputs can shift the entire supply curve. > equilibrium price: current market price for an item and the intersecting point of the supply and demand curve.