Demand and Supply

January 12, 2015

Demand: Is the quantity that people are willing to buy at various prices.

• The law of demand- There's an invers relationship between price and quantity demanded. 
• The causes of a change in quantity demanded- *Change is represented by a Delta Δ*

• A Δ in buyers taste "Advertising"
• A Δ in number of buyers "Population"
• A Δ in income 
• Normal goods that buyers buy more of when income rises. 
• Inferior goods that buyers buy less when income rises.
• A Δ in price on relative goods. 1. Substitute good that server roughly the same purpose to buyers.  2. Complementary goods often consume together.
• A Δ  in expectation

Supply: Quantity that seller are willing  and able to produce various quantities.

• The law of supply- Theres a direct relationship between price and quantity supply.
• The causes of a change in quantity supply- *Change is represented by a Delta Δ*
• A Δ in weather
• A Δ in technology
• A Δ in cost of production
• A Δ in number of sellers
• A Δ in taxes 
• A Δ in expectation