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DEMAND AND SUPPLY - Coggle Diagram
DEMAND AND SUPPLY
DEMAND
Definition
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- price increase, quantity demanded decrease.
- price decrease, quantity demanded increase
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Change
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in Demand
- increase/decrease in quantity demanded at possible price.
- increase - rightward shift in demand curve
- decrease - leftward shift
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SUPPLY
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Law of supply
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- price falls, quantity supplied falls
- price rises, quantity supplied rises
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Change
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in Supply
- increase/decrease in quantity supplied at possible price
- increase - rightward shift in curve
- decrease - leftward shift
Nonprice determinants
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- price of other goods the firm can produce
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MARKET EQUILIBRIUM
Excess Demand (Shortage)
- (quantity supplied < quantity demanded)
- price below equilibrium price
- decrease in quantity demanded
- increase in quantity supplied
Excess Supply (Surplus)
- price falls above equilibrium price
- quantity supplied > quantity demanded
- increase in quantity demanded
- decrease in quantity supplied
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