Prices of inputs used to produce the good technology used to produce the good. Adverse change in tastes due to bad news about a product 2. Demand and supply lecture notes free download as word doc. About the tutorial supply chain management can be defined as the management of flow of products and services, which begins from the origin of products and ends with the products consumption at the enduser. We restrict our focus to one single market supply total amount of a good that all producers are willing to sell demand total amount of a good that all consumers are willing to buy 2. Apr 17, 2016 supply and demand together equilibrium price the price at which the supply and demand curve intersect. Dual shifts in supply and demand when supply and demand change simultaneously, the impact on the equilibrium. The book is available in the major bookstores in singapore. Supplydemand lecture notes 1 supply economics demand. Learn vocabulary, terms, and more with flashcards, games, and other study tools. Lecture notes principles of macroeconomics economics. The explanation works by looking at two different groups buyers and sellers and asking how they interact. All goods sold in the market sell for the same prices and.
Sc1x supply chain and logistics fundamentals lesson. Supply and demand market and models demand supply market equilibrium elasticity. For general help, questions, and suggestions, try our dedicated support forums. Having explained the theoretical framework, we are now ready to explain business cycle behavior using the aggregate demand aggregate supply model. On the vertical axis is the overall level of prices. Equilibrium quantity the quantity at which the supply and demand curve intersect. Lecture 2 demand and supply free download as powerpoint presentation. Here are your useful notes on demand and law of demand. Problem set 1 is due at the beginning of lecture next tuesday february 4.
Lecture notes, lecture 2 the basics of supply and demand. Generally, economic expansions and contractions are driven by shifts in the aggregate demand or aggregate supply curves. A demand curve is a graphical representation of the relationship between price and quantity demanded ceteris paribus. Ec3 september 18, 2017 1 demand and supply we are going to work under the assumption of a competitive market. Price elasticity of demand for agricultural products is 0. Movement along a demand curve and shifts in the demand curve 9. Mit opencourseware makes the materials used in the teaching of almost all of mits subjects available on the web, free of charge. It changes the amount of individual supply curve to add up.
Marketdemandsupply isthesum ofindividual demandssupplies. Market structure part i perfect competition and monopoly 6 22. This section provides the schedule of lecture topics along with lecture notes for each topic. All goods bought and sold in the market are identical 3. Aggregate supply as and demand ad in the simple keynesian model the interest rate and the price level p is assumed to be fixed in the islm model p is assumed to be fixed. Price elasticity of demand is how economists measure the responsiveness of quantities demanded to changes. A movement along the curve versus a shift of the curve 3. Demand the quantity demanded corresponding to a price of any good is the amount of the good that buyers are willing and able to purchase at this price law of demand. So a 1 percent decrease in the quantity harvested will lead to a 2. Graphically, the demand curve shifts up to the right. How to learn demand and supply economics lecture afzaal khan. With more than 2,400 courses available, ocw is delivering on the promise of open sharing of knowledge. The supply chains of large corporations involve hundreds of facilities retailers, distributors, plants and suppliers that are globally distributed and involve thousands of.
Aggregate demand and aggregate supply price level quantity of output equilibrium price level aggregate supply aggregate demand equilibrium output economists use the model of aggregate demand and aggregate supply to analyse economic fluctuations. Please note that this is different from the books definition of normal. Note that 1this demand curve is not a straight line. Aggregate demand and supply analysis yields the following conclusions. There are three different periods of supply a momentary supply sometimes called market supply the amount currently available immediately the firm is unable to respond to price changes in effect the supply is fixed a vertical s curve. Th d d the demand curve the supply curve factors causing shifts of the demand curve and shifts of the supply curve. Since these will change sellers marginal cost number and scale of sellers, of couse. Expectations call me leah class should be hard, but not impossible what we learn should be clearly applicable. Two goods are said to be substitutes when the fall in the price of one leads to a left shift in the demand curve for the other. Demand, supply, and equilibrium economic department, saint louis university instructor.
Students can refer to economics a singapore perspective for the diagrams. Supply and demand together equilibrium price the price at which the supply and demand curve intersect. Demand and supply will be taught in economics tuition in the second and third weeks of term 1. Lectures in supplychain optimization stanford university. Lr supply curve may be upwardsloping if min ac is rising in market demand q due, for example, to resource scarcity ec 105.
We strongly recommend working on the problems by yourself first. Tianyi wang queens univerisity lecture 7 winter 20 2 46. From individual demand curves to aggregate, when we have more people. A shift in the aggregate demand curve affects output only in the short run and has no effect in the long run 2. Economists use the model of aggregate demand and aggregate supply to analyse economic fluctuations. Dec 10, 20 how to learn demand and supply economics lecture afzaal khan. Many buyers and sellers in the market even though experimental evidence shows that many is at least three traders in one side of the market. Most of time we are looking for market demand, or the sum of all the individuals quantities demanded in a market example.
Supply chain management objective maximise the overall value generated is the difference between what the final product is worth to the customer and the effort the supply chains expends in filling the request of the customer supply chain profitability is the difference between the revenue generated from the. Aggregate demand, aggregate supply, and the business cycle. Theincome elasticity of demand, and the crossprice elasticityof demand. We shall study the law of demand and in the next the elasticity of demand. But before we analyse them, it is essential to understand the nature of the term demand in economics. Market equilibrium demand and supply shifts and equilibrium prices the demand curve 2 the demand curve graphically shows how much of a good consumers are.
As a current student on this bumpy collegiate pathway, i stumbled upon course hero, where i can find study resources for nearly all my courses, get online help from tutors 247, and even share my old projects, papers, and lecture notes with other students. Introduction topic 2 established the di rection of changes in demand and supply to a change in price a further question is the size of the change elasticity measures the sensitivity or responsiveness of these changes definition elasticity measures the change in one variable in response to a change in another variable. A temporary supply shock affects output and inflation only in the short run and has no effect in the long run holding the aggregate demand curve constant 3. Lecture notes, lecture 7 the cost of production lecture notes, lecture 8 profit maximization and competitive supply lecture notes, lecture 12 monopolistic competition and oligopoly lecture notes, lecture game theory and competitive strategy lecture notes, lecture 17 markets with asymmetric information lecture notes, lecture 18 externalities and public goods. This is a brief introductory tutorial that explains the methodologies applied in the rapidly. On the supply curve, when the price rises, the quantity supplied increases. Marketdemand supply isthesum ofindividual demandssupplies. Islm investment savingliquidity preference money supply.
So far weve seen that on the demand curve, when the price rises, the quantity demanded falls. The amount of a goodservice that consumers are willing and able to buy at a given price and time. Treasury notes and some other financial instruments are sold using a form of. The savingsinvestment motivation for yd is closely related to the demandsupply analysis on financial markets. Demand is inelastic and farmers total revenue will increase. Supply and demand in equilibrium what would happen if a major oil exporter suddenly stopped production, as libya did in 2011. Demand and supply analysis economics lecture notes 5,695 views. Demand and supply analysis is the study of how buyers and sellers interact to. An increase in demand means that consumers wish to purchase more of the good at every price than before. Lecture note on classical macroeconomic theory econ 5 prof. Industrial organization matt shum hss, california institute of technologylecture 2. Supply chain management encompasses the planning and. Supplydemand lecture notes 1 free download as powerpoint presentation.
A demand curve is a graphical representation of the relationship between price and quantity. And for that reason, well begin this course in the principles of macroeconomics with a quick look at the theory of supply and demand. Economics lecture notes chapter 2 demand and supply will be taught in economics tuition in the second and third weeks of term 1. Lecture notes aggregate demand and aggregate supply. Lecture 2 demand and supply supply economics demand curve. The demand for colombian coffee is more elastic than. Aggregate demand is the total amount of spending at each possible price level. In essence, supply chain management integrates supply and demand management within and across companies. The model will look at demand and supply for the economy as a whole. If youre having any problems, or would like to give some feedback, wed love to hear from you.
Lecture 2 demand and supply supply economics demand. Supply shift the supply curve shifts when these variables change. As a result of an increase in demand, the equilibrium price rises as does the equilibrium quantity bought and sold. Elasticity of demand and supply will be taught in economics tuition in the fourth and fifth weeks of term 1. Other things being equal, when the price of a good rises, the quantity demanded of the good falls, and when the price falls, the quantity demanded rises. Dec 25, 2017 lecture notes demand and supply demand. Org web experience team, please use our contact form. The explanation works by looking at two different groups. Savings provide a supply of funds to financial markets, a demand for bonds and other. Admins and dm and mdemandsupplyeqbmelasticity course administration 1. Graphical depiction of the relationship between the price of a good and the amount of the good that consumers are both willing and able to buy at that price, holding other factors constant ceteris paribus.
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