ECON 2000 Chapter : Econ Chapter 4
Document Summary
Market: a market is a group of buyers and sellers of a particular good or service. Market: in the market, resources are allocated through prices. Assumed until chapter 15 as it is a good starting point and also a basic and important building block for more complicated models. Usually price and quantity demanded have inverse relationship. The amount of a good that buyers are willing and able to purchase for given prices. (quantity. Individual demand: given each price, the quantity demanded denotes where the marginal bene t equals the price for each individual, closely related to the principle that rational people think at the margin. Let"s make catherine"s consumption plan into a table! Price that catherine will consume each quantity of the ice-cream cone. Thus individual demand schedule is where marginal cost=marginal bene t, i. e. price=marginal bene t, for each individual.
