How supply and demand for a good determines both the quantity produced and the price
Chapter 4 of our course text focuses on market supply and market demand, which are microeconomic concepts rather than macroeconomic concepts. In addition, our Week 1 objective of analyzing “. . . how supply and demand for a good determines both the quantity produced and the price at which the good sells and how buyers and sellers respond to changes in market conditions” is also in the realm of microeconomics.
Market supply curves and market demand curves show the supply of, and demand for, individual products and services, such as shoes, shoe shines, and shinola.
Please note: There is also a tricky little distinction between what economists refer to as a change in demand and a change in quantity demanded; before you start work on your Week 2 paper you should be aware of that distinction. Consider the two graphs shown below.
Which graph shows a change in demand? Which graph shows a change in quantity demanded? As a warm up for your assignments, can you provide real-world examples of changes in demand and changes in quantity demanded?
Many aspects found in economics deal with the behaviour of human beings under certain economic conditions. Hence, at times economics can be regarded as a social science. Furthermore, this is evident from the definitions. For instance, economics studies the behaviour of individuals when they are managing resources……………………………..