ECON 1 Chapter Notes - Chapter 3: Demand Curve, Complementary Good, Economic Equilibrium
Document Summary
Product: a good (tangible product), service (intangible) Market: is not a physical place but the collection of the actions of the buyers and sellers of a product. Demand : captures the behavior of the buyers. Prices of other items we could use with or instead of this product. Prices of other items that could be produced with the same inputs. Equilibrium price: the quantity of the product buyers wish to purchase (quantity demanded) equals the quantity of the product of sellers wish to sell (quantity demanded. Quantity demanded: quantity associated with any one particular price. Market demand : for a product is the sum of everyone"s individual demand. Demand schedule: the relationship between price and quantity demanded depicted in a table. For the supply and demand model price is always on the vertical axis while quantity is always on the horizontal axis. Has negative slope: there is an inverse relationship between price and quantity demanded.
