MICROECONOMICS
DEMAND AND SUPPLY
DEFINE DEMAND AND SUPPLY
• DEMAND: The amount of a particular economic good or service that a consumer or group of consumers will want to purchase at a given price.
SLOPE OF DEMAND: The demand curve is usually downward sloping, since consumers will want to buy more as price decreases.
• SUPPLY: The total amount of a good or service available for purchase; along with demand, one of the two key determinants of price.
SLOPE OF SUPPLY:The supply curve usually slopes upward, since higher prices give producers an incentive to supply more in the hope of making greater revenue.
DEMAND AND SUPPLY GRAPHS
• DEMAND • SUPPLY
MARKET EQUILIBRIUM POINT
DEFINITION• A state of equality between
the level of available supply of a product or service, and the amount of demand for that product or service.
GRAPH
SURPLUS VS SHORTAGE
• SHORTAGE: shortage is just the opposite where demand is high and supply is low.
• SURPLUS: economic surplus means that there is more of the product freely available than the demand for the product asks for.
SHORTAGE VS SURPLUS
MACROECONOMICS
CONTINUES