Supply and demand Flashcards
is the schedule of various quantities of goods and services which buyers are **willing and able to purchase **at a given price, time and place, all other factors are held constant [ceteris paribus].
Demand
The law of demand states that as the price —–, the quantity demanded——-, and as the price ———, the quantity demanded ———, ceteris paribus.
The law of demand states that as the price increases, the quantity demanded decreases, and as the price decreases, the quantity demanded increases, ceteris paribus.
Various factors affecting demand include the following;
- Price of the product
- Income of the buyers
is a listing of the different quantities of goods and services that buyers will purchase given the various alternative prices.
A demand schedule
is the schedule of various quantities of goods and services which sellers are willing and able to sell at a given price, time and place, all other factors are held constant [ceteris paribus].
Supply
The law of supply states that as the price——-, the quantity supplied also ——–, and as the price ———-, the quantity supplied also d———, ceteris paribus.
The law of supply states that as the price increases, the quantity supplied also increases, and as the price decreases, the quantity supplied also decreases, ceteris paribus.
Some factors affecting supply;
- Price of the product
- Cost of production
- Availability of raw materials
is a listing of the different quantities of goods and services that sellers will sell given the various alternatives prices.
A supply schedule
The condition when quantity demanded is equal to quantity supplied is said to be
Market Equilibrium
When there is no equilibrium,
there is no balance between the demand and supply
This happens when the price gets lower than the equilibrium price
is a condition when the quantity demanded exceeds the quantity supplied.
Shortage
This occurs when the price is above the equilibrium price.
is a condition when the quantity supplied is greater than the quantity demanded.
Surplus
