UNC-Chapel Hill ECON 101 - Demand and Supply Examples (9 pages)

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Demand and Supply Examples



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Demand and Supply Examples

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Pages:
9
School:
University of North Carolina at Chapel Hill
Course:
Econ 101 - Introduction to Economics

Unformatted text preview:

Demand and Supply Examples Review Price Floors and Ceilings keep market price from allocating scarce goods Using demand and supply to predict changes in prices and quantities Shifts in the demand schedule Shifts in the supply schedule What have we learned Econ 101 M Salemi Econ 101 M Salemi Price is a Rationing Mechanism 32 00 28 00 24 00 20 00 Price A Demand Schedule shows the quantity of a welldefined good that buyers are willing and able to purchase at each possible price A Supply Schedule shows the quantity of a welldefined good that sellers are willing and able to sell at each possible price The Equilibrium Price Is the price such that quantity demanded equals quantity supplied Separates prospective buyers into two groups those who get the good and those who do not Econ 101 Demand for UCSC T Shirt 16 00 12 00 8 00 4 00 0 00 0 25 50 75 100 125 150 175 200 225 250 275 300 325 TShirts Econ 101 M Salemi Econ 101 M Salemi 1 Review Supply Schedule Market Equilibrium occurs at the price where quantity demanded equals quantity supplied Supply Schedule for Pizza Store G 4 50 4 00 Dollars per Slice Dollars per Slice Demand and Supply of Pizza 5 50 5 00 4 50 4 00 3 50 3 00 2 50 2 00 1 50 1 00 0 50 0 00 Store B Individual Stores Supply Pizza Only When Their Reservation Price is Met Store A 0 200 3 50 3 00 Equilibrium 2 50 2 00 1 50 Demand Supply 1 00 0 50 400 600 800 1000 1200 1400 1600 Slices of Pepperoni Pizza 0 00 0 200 400 600 800 1000 1200 1400 1600 Slices of Pepperoni Pizza Econ 101 M Salemi Econ 101 M Salemi In equilibrium the number of slices that will be denied to consumers even though consumers have a positive reservation price for those slices is Demand and Supply of Pizza Use Your Clickers To Answer The Following Graded Question 4 50 A B C D 0 600 1000 1600 Dollars per Slice 4 00 3 50 3 00 Equilibrium 2 50 2 00 1 50 Demand Supply 1 00 0 50 0 00 0 200 400 600 800 1000 1200 1400 1600 Slices of Pepperoni Pizza Econ 101 M Salemi Econ 101 M Salemi 2 Given the



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