1、(微观经济学英文课件）Chap 4 Supply and DemandMarketsuA market is a group of buyers and sellers of a particular good or service. In this chapter, we assume market is Perfect Competition.Monopoly,Oligopoly, Monopolistic CompetitionLesson 1 Demandn1.definitionn2.Demand Schedulen3.Demand Curven4.Law of Demandn5.
2、Change in Quantity Demanded versus Change in Demandn6. Market Demand1.definitionQuantity demanded is the amount of a good that buyers are willing and able to purchase.2.Demand ScheduleThe demand schedule is a table that shows the relationship between the price of the good and the quantity demanded.
3、$3.002.502.001.501.000.502134 56789 101211Price of Ice-Cream ConeQuantity of Ice-Cream Cones03.Demand CurveThe Demand CurveDThe demand curve slopesdownward, demonstrating that consumers are willingto buy more at a lower priceas the product becomes relatively cheaper.Quantity Price($ per unit)P2Q1P1Q
4、2Measures quantity on the x-axis and price on the y-axisf(P)QD4.Law of DemandThe law of demand states that there is an inverse relationship between price and quantity demanded.Can you summarize other determinants of Demand?uConsumer incomeuTastesuExpectationsuPrices of related goodsrelated goodsnSub
5、stitutesn Complements5.Change in Quantity Demanded versus Change in Demand(1)Changes in Quantity Demanded0D1Price of Cigarettes per PackNumber of Cigarettes Smoked per DaySuppose a tax that raises the price of cigarettesAC202.00$4.0012uMovement along the demand curve.uCaused by a change in the price
6、.nCaused by a change in a determinant other than the price. nA shift in the demand curve, either to the left or right.(2)Changes in Demand0D1Price of Ice-Cream ConeQuantity of Ice-Cream ConesD3D2Increase in demandDecrease in demand such as:Consumer Incomeu if income increases uthe demand for a norma
7、l good will increase.uBut inferior good will decrease.Normal Good$3.002.502.001.501.000.502134 56789 101211Price of Ice-Cream ConeQuantity of Ice-Cream Cones0Increasein demandAn increase in income.D1D2Inferior Good$3.002.502.001.501.000.502134 56789 101211Price of Ice-Cream ConeQuantity of Ice-Cream
8、 Cones0Decreasein demandAn increase in income.D1D2Summary:VariablesresultPriceRepresents a movementalong the demand curve Consumer IncomeShifts the demand curvePrices of relatedgoodsTastesExpectationsNumber ofbuyers6.Market DemanduMarket demand refers to the sum of all individual demands.uGraphicall
9、y, individual demand curves are summed horizontally to obtain the market demand curve.The demand for tomatoes (monthly)Lesson 2 :Supplyn1.definitionn2.Supply Schedulen3. Supply Curven4.Law of Supplyn5. Change in Quantity Supplied versus Change in Supplyn6.Market Supply1.definitionQuantity supplied i
10、s the amount of a good that sellers are willing and able to sell. 2.Supply SchedulePriceQuantity$0.0000.5001.0011.5022.0032.5043.005The supply schedule is a table that shows the relationship between the price of the good and the quantity supplied. 3.Supply Curve$3.002.502.001.501.000.5021345 6789 10
11、1211Price of Ice-Cream ConeQuantity of Ice-Cream Cones0PriceQuantity$0.0000.5001.0011.5022.0032.5043.005The supply curve is the upward-sloping line relating price to quantity supplied. 4.Law of SupplyThe law of supply states that there is a direct (positive) relationship between price and quantity s
12、upplied.Other determinants of SupplyuInput pricesuTechnologyuExpectations uNumber of producers5.Change in Quantity Supplied versus Change in Supply(1)Change in Quantity Supplied1 5Price of Ice-Cream ConeQuantity of Ice-Cream Cones0S 1.00AC$3.00A rise in the price of ice cream conesHarcourt, Inc. ite
13、ms and derived items copyright 2001 by Harcourt, Inc.nMovement along the supply curve.nCaused by a change in the market price of the product.(2)Change in SupplyPrice of Ice-Cream ConeQuantity of Ice-Cream Cones0S1S2S3Increase in SupplyDecrease in SupplyuA shift in the supply curve, either to the lef
14、t or right. uCaused by a change in a determinant other than price.6.Market SupplyuMarket supply refers to the sum of all individual supplies for all sellers of a particular good or service.uGraphically, individual supply curves are summed horizontally to obtain the market supply curve.Lesson 3: Equi
15、libriumnThe curves intersect at equilibrium, nor market-clearing Supply and Demand TogetherPriceQuantity$0.0000.5001.0011.5042.0072.50103.0013PriceQuantity$0.00190.50161.00131.50102.0072.5043.001Demand ScheduleSupply ScheduleAt $2.00, the quantity demanded is equal to the quantity supplied!SupplyDem
16、andPrice of Ice-Cream ConeQuantity of Ice-Cream ConesEquilibrium of Supply and Demand21345 6789 1012110$3.002.502.001.501.000.50EquilibriumsurplusDSP0Q0P1SurplusQuantity Price($ per unit)QSQDSurplusWhen the price is above the equilibrium price, the quantity supplied exceeds the quantity demanded. Th
17、ere is excess supply or a surplus. Suppliers will lower the price to increase sales, thereby moving toward equilibrium.At P1, price is above the market clearing priceQs QDPrice falls to the market-clearing priceMarket adjusts to equilibriumshortageDSQSQDP2Quantity Price($ per unit)Q3P3ShortageShorta
18、geWhen the price is below the equilibrium price, the quantity demanded exceeds the quantity supplied. There is excess demand or a shortage. Suppliers will raise the price due to too many buyers chasing too few goods, thereby moving toward equilibrium.At P2, price is below the market clearing priceQD
19、 QSPrice rises to the market-clearing priceMarket adjusts to equilibriumThree Steps To Analyzing Changes in EquilibriumuDecide whether the event shifts the supply or demand curve (or both).uDecide whether the curve shifts to the left or to the right.uExamine the new equilibrium.Harcourt, Inc. items
20、and derived items copyright 2001 by Harcourt, Inc.? to icecreamnHot weatherHow an Increase in Demand and supplyPrice ofIce-CreamCone2.0007Quantity ofIce-Cream ConesSupplyInitialequilibriumD11. Hot weather increasesthe demand for ice cream.D22. .resultingin a higherprice.$2.50103. .and a higherquanti
21、ty sold.New equilibriumHarcourt, Inc. items and derived items copyright 2001 by Harcourt, Inc.Harcourt, Inc. items and derived items copyright 2001 by Harcourt, Inc.What Happens to Price and Quantity When Supply or Demand Shifts?What Happens to Price and Quantity When Supply or Demand Shifts?Harcourt, Inc. items and derived items copyright 2001 by Harcourt, Inc.exercisenText book P86n2. 5. 12. 13
