Econ week three notes
Econ week three notes Econ 150-21
Popular in Intro Macroeconomics
verified elite notetaker
Popular in Economcs
This 2 page Class Notes was uploaded by Olivia Notetaker on Sunday February 7, 2016. The Class Notes belongs to Econ 150-21 at La Salle University taught by Dr. Mshomba in Fall 2016. Since its upload, it has received 25 views. For similar materials see Intro Macroeconomics in Economcs at La Salle University.
Reviews for Econ week three notes
Report this Material
What is Karma?
Karma is the currency of StudySoup.
You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!
Date Created: 02/07/16
Econ week three notes nd th February 2 and 4 - Milk= f(price of substitutes, nutritional value, number of consumers, consumer income, taste, price of milk, expectations…) o Related goods= substitute and complementary o If everything is held constant EXCEPT price of milk- If price decreases, demand increases= law of demand. Inverse relationship between price and quantity demanded Line= demand (price and quantity demanded together) Specific point on line= quantity demanded Shift in whole curve= change in demand (happens because of determinants of demand) Shift in points= change in quantity demanded (happens because of price of product itself) - We have to know if product is normal or inferior good to know what would happen to a product - Change in income: income increases for normal goods, demand increases (shift right); for inferior goods, demand decreases (shift left) - Increase in number of buyers= increase in demand - Increase in taste= increase in demand - Change in price of related good (oj)increases = increase in demand for other product (milk) o Positive relationship with substitute goods - Change in price of cereal increases= demand for milk decreases o Inverse relationship with complementary goods - Change in quantity supplied is change in point, change in supply= shift in curve - Law of supply- price goes up, quantity supplied goes up o Positive relationship o Technology, prices of resources, expectations, taxes and subsidies, number of sellers, prices of related goods - The slope tells us how sensitive suppliers or demanders are to change - The production cost determines the location of the supply line o Improvement in technology= decrease in cost o If taxes decrease, decrease in cost. If subsidies increase, decrease in cost o Anything causing product cost to decrease causes supply curve to shift outward o Price of resources decrease= production cost decreases o Expectations: if you’re selling something and expect higher prices in future, you’ll sell less now. Supply with decrease. Consumers will want to buy now, so price will increase. o Prices of related goods: if price of trucks increase, supply of trucks will increase, supply of cars will decrease - Equilibrium price- amount of supply=amount of demand - Equilibrium is a moving target - If you have the equation for Qd and Qs, set them equal to each other to find price o If want individual, find price and substitute - If Qd is less than Qs, you have a surplus o Any point higher than equilibrium price is a surplus. Creates pressure for price to fall - If Qd is more than Qs, you have a shortage - Price ceiling= max price you can sell a product o Set by government o Usually set below equilibrium price
Are you sure you want to buy this material for
You're already Subscribed!
Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'