Demand and Supply

CHAPTER OUTLINE

1)
WHAT’S DEMAND?

 Law of demand
 Assumptions and limitations
 Causes of rise and fall in demand
 Demand and quantity demanded
 Demand and price

2)
WHAT’S SUPPLY?

 Law of supply
 Assumptions and limitations
 Causes of rise and fall in supply
 Supply and quantity supplied
 Supply and price

3)
THE CONCEPT OF MARKET

MARKET DEMAND

 Shift in demand curve

 Factors affecting demand curve
 Changes in quantity demanded
 Movement along demand curve versus shift

4)
MARKET SUPPLY

 Shift in supply curve

 Factors affecting supply curve
 Changes in quantity supplied
 Movement along supply curve versus shift

5)

MARKET EQUILIBRIUM
  Equilibrium price and quantity
 Surplus and shortage
 Changes in supply, demand and equilibrium

6)

GOVERNMENT INTERVENTION IN MARKETS

 Price ceiling
 Price flooring

7)

ALGEBRAIC TREATMENT OF DEMAND AND SUPPLY THEORY

8)

SUMMARY

TERMS AND CONCEPTS

DISCUSSION QUESTIONS

PROBLEMS