ECON 101 Chapter Notes - Chapter 3: Takers, Economic Equilibrium, Perfect Competition

• School: U of M
• Department: Economics
• Course: ECON 101
• Professor: Mitchell Dudley

Document Summary

Relationship between price and quantity supplied (producers responding to price) Quantity supplied has fallen at each price, shifting the supply curve to the left (decrease) Movement along vs. shift of the supply curve. If change in price = movement along supply curve. If event changes way producers value production = shift of the supply curve. Events that changes the way a producer values the product (considerations in production process) Input = things going into the production process to create the output. Output = good producing and selling in market. Cost of production rises, quantity supplied decreases (costs more to produce each unit) Cost of production decreases, quantity supplied increases (costs less) Changes in the prices of production related goods or services. Complements in production = two goods, when producing one produces the other. Substitute in production = two goods, when producing one results in decrease in production of the other.