demand and supply
TRANSCRIPT
DEMAND AND SUPPLY
PREPARED BY:
VINOD SOLANK
STD = X
ROLL =43
• Quantity of commodity buyers are willing to buy
• Behavior of buyers• Relationship between
• Quantity demanded of a good• Price• Holding other factors constant
Demand
• Amount of good or service• Per unit of time• The amount of goods which would be
demanded at a particular price.
Quantity Demanded
Demand Schedule
• List of Qd at each price• table of the quantity demanded of a
good at different price levels• table that lists the quantity of a good
all consumers in a market will buy at every different price
Demand Schedule
Price Quantity Demanded
1 52 43 34 25 1
Demand Curve
• Graph of demand schedule• A graphic representation of the
relationship between the price of a commodity and the quantity demanded
• Has negative slope
Demand Curve
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Quantity demanded
Price
Law of Demand
• As the price (P) increases the quantity demanded (Qd) decreases
• As the price (P) decreases the quantity demanded (Qd) increases
Factors Affecting Demand• Income
• If income decreases demand for such goods and services also declines
• Purchasing power of individuals• Normal goods- increase in income =
increase in demand• Inferior goods- increase in income =
decrease in demand
• Buyer expectation• Expected change in
• Future income• Future prices
• No. of buyers/ consumers• More people = more demand for goods
and services• demographics
• Preferences and taste• Trend• Change in technology• Something you want• Likes and dislikes
• Prices of related goods• When the price of a certain product increases,
people tend to buy a substitute product• In the case of complementary goods, if the
price of one good increases the demand the demand for the other goods decreases
Change in Demand
• Other factors affecting demand changes• Either shift to the RIGHT• Or shift to the LEFT
Shifting of the curve to the right
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Quantity demanded
Price
Shifting of the curve to the left
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Quantity demandedColumn1
Price
Change in Quantity Demanded
• Movement along the curve• Theres a change in price and holding
other factors constant
Shifting along the curve
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Quantity demanded
Price
Supply
• Amount of goods and services sellers are willing to sell or supply in the market
• The amount of a resource that is available
Law of Supply
• As the price(P) increases quantity supplied (Qs)also increases
• And as the price (P) decreases the quantity supplied (Qs)also decreases
Supply schedule
Price Quantity supplied1 12 23 34 45 5
Supply Curve
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Quantity supplied
Price
Factors Affecting Supply
• Cost of inputs• These are the raw materials needed in
producing goods• Prices of related goods
• Changes in price of goods have effects in the supply of such goods
• Seller expectation• Expect to rise very soon = keep the goods then
releases when prices are already high
• No. of sellers• More sellers or more producers = increase in
supply• Less sellers or less producers = decrease in
supply• Productivity
• Output• Increase in output lowers cost• Cause:
• Technology• Human capital
Change in Supply
• Other factors affecting supply change• If it increases shift to the RIGHT• If it decreases shift to the LEFT
Change in Supply
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Quantity suppliedColumn1
Price
1 2 3 4 50
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Quantity suppliedColumn1
Price
Change in Quantity Supplied
• When price change holding other factors constant• Movement along the curve
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Quantity supplied
Price
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