Sunday, April 29, 2012

4 - Supply and Demand

.Supply and Demand - CrCo > .
22-2-4 How to Read the Jobs Report | WSJ > .
Economics - Primer >> .

Supply and Demand 

1) Market - any place where buyers and sellers meet to exchange goods and services.
a. An owner of a supermarket values the labor of the cashier more than money she pays him.

2) Price signals - the information that markets generate to guide the distribution of the resources.
a. Businesses, and in particular large corporations , are often villainized as greedy, heartless institutions, that take advantage of consumers, but if markets are transparent and buyers are free to choose, then businesses will have a hard time making advantage of people.

3) Supply and demand.
a. When the price goes up - people buy less, when the price goes down - people buy more.
b.When the price goes up - the farmer wants to produce more, when the price goes down - the farmer wants to produce less.
c. When quantity supplied = quantity demanded, we get equilibrium price of product.

4) Four market behaviors
a. Supply can decrease.
b. Supply can increase.
c. Demand can increase.
d. Demand can decrease.

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