ECON 203 Lecture 3 Outline of Last Lecture I Main Idea II Production Possibility Curve PPC III Economic System Outline of Current Lecture I Main Idea II Market Types and Factors Current Lecture Main Ideas Ideologies help economists choose a feasible combination of goods and allocation of resources to achieve the desired level of production A laze fare ideology would mean no government interference letting people do their own thing pure capitalism Ideologies can produce different economies production levels with the same options Most Nations choose a Mixed Economy pick parts of different economic systems to decide their ideology and choose what they think is most efficient Economies use their Markets as an Organizing Factor Market types factors Monopoly One seller with many buyers monopolies completely control the market for a good can increase or decrease price without constraints other sellers Competitive markets Many sellers and many buyers Competitive markets abide by the laws of supply and demand since competition keeps prices similar if one seller decides to increase price buyers will go elsewhere forcing seller to lower price Oligopoly Few sellers but many buyers tends to lead to collusion where the sellers agree on prices to set essentially making it a multi company monopoly Fungible goods goods that are the same even between sellers a tomato from one farmer has the same value as a tomato from the farmer down the road Demand factor In Economies the quantity demand for a good is inverse to the price the HIGHER the price LESS people will buy the LOWER the price the MORE people will buy