ECONOMICS AS

A FIELD OF STUDY
 Micro economics

By Engr. Ma. Nerissa P. Sangalang, RCE,LPT,MBA

 Market Equilibrum

This is reached when the quantity of

supply and demand are balanced or
equal at a given price level.

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 Surplus and Shortage

Surplus is experienced when the price of

a good is above equilibrium price.
Shortage is when the price is below
equilibrium price.

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 The Algebraic Equations
P = a + mdQd
P = a + m s Qs
where:
Qd is the quantity demanded
Qs is the quantity supplied
P is the price
-md is the slope of demand curve; a is the intercept value if Qd is zero.
ms is the slope of supply curve; a is the intercept value if Qs is zero.

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Computations for the Equilibrum

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 Surplus and Shortage
( The Graphical Approach)
EQULIBRUM, SHORTAGE AND SURPLUS
( GRAPHICAL APPROACH)
4.5
4 4
4

3.5

3
surplus 3
PRICE

2.5

2
equilibrum
2

1.5

1
shortage 1

0.5
0 0
0
0 10 20 30 40

QUANTITY

DEMAND Linear (DEMAND) Series 3

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Praise and glorify GOD
always!
END