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Final Economic Project

Final Economic Project

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Published by kArL

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Published by: kArL on Mar 07, 2010
Copyright:Attribution Non-commercial


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Chapter. 7
Analysis of DemandWhat is Demand?
-Demand is defined as the quantity of a commodity that a buyer is willing topurchase at alternative prices at a given point in time. There is demand foralmost all commodities under the market system.
Demand Curve
-A Demand curve is a graphic representation of the relationship between theprice of a commodity and the quantity of it demanded; other things beingequal.
Elasticity of Demand
-The degree of responsiveness of the change in demand as a result ofchange in price, however, varies with several factors.
Consumer Behavior
-According to economists and consumers in general demand for goods andservices because they derived utility from its consumption. By Utility, wemean a level of satisfaction or happiness.
Analysis of SupplyWhat is Supply?
-Supply is the amount of goods and services which sellers are willing to sell orsupply in the market at various alternative prices at a given point in time.
 The Supply Curve
-Supply Curve is a graphic representation of the relationship between the amountswhich sellers are willing to supply the market with a particular commodity atvarious prices, other things held constant.
 The Cost of Production
-The price of the inputs used in the production process. The basic factor inputs wewill discuss in this section are labor, capital, land, and enterprise.
Opportunity Cost
-Deeply rooted in the basic assumptions of economics.
 The production Function
-Is a technical relationship between inputs and output in a production process.
Price Elasticity of supply
-The amount of influence exerted by a change in price on a change in the quantityof goods supplied.
Market EquilibriumConcept of Equilibrium
-The process of resolving the conflict in the diverging behavior of buyers andsellers in the market is a movement toward an equilibrium.
Market Equilibrium
-A condition in the market where the quantity demanded is equal to the quantitysupplied.
Market StructuresPerfect Competition
-refers to markets where no firm or consumer is large enough to affect themarket price or output
Pure monopoly
-In direct contrast to a market where there is perfect competition is a marketstructure with a single producer or seller of a commodity or service.
-is a market structure characterized by few sellers in a large market.
Monopolistic Competition
-a market structure wherein there are many sellers who are supplying goods thatare slightly differentiated.

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