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Lu2 (Demand (Change in demand (A shift in the demand curve either to left…
Lu2
Demand
Law of demand
Other thing equal, the quantity demanded of a good falls when the price of that good raises.
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Supply
Law of Supply
Other things equal, the quantity supplied of a good rises when the price of good rises.
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Market and competition
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Competitive market
A market at which there are many buyer and seller, so that they have a little bit of impact on the market price.
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Market Equilibrium
Equilibrium
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Surplus
When the price bigger than equilibrium price and the quantity supplied bigger then quantity of demanded.
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Suppliers will lower the price to encourage people consume more to increase the sales, thereby moving toward equilibrium.
Shortage
When the price is smaller than equilibrium price and the quantity supplied smaller than quantity demanded.
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Suppliers will increase the price to lower the sales, thereby moving toward equilibrium.