Economics and Business Chapter 2 – 2 Download this book for free at: ttp://hdl.handle.net/10919/70961

Review What do the supply and demand curves look like? What affects the demand curve? What affects the supply curve?

Learning Objectives Describe capitalism and socialism Discuss private property rights and economic development Discuss the concept of GDP (gross domestic product). Explain fiscal and monetary policy Discuss the concept of the unemployment rate Discuss the concepts of inflation and deflation. Explain other key terms including: supply; demand; equilibrium price; monopoly; recession; depression. Download this book for free at: ttp://hdl.handle.net/10919/70961

Economics Supply & Demand Equilibrium price – price at which consumers are willing to purchase everything a business is willing to make No surplus No shortage Download this book for free at: ttp://hdl.handle.net/10919/70961

Supply and Demand Curve Changes Shift right in the demand curve Results in higher prices and greater quantity S Price D’ D Quantity

Supply and Demand Curve Changes Shift left in the demand curve Results in lower prices and less quantity S Price D D’ Quantity

Supply and Demand Curve Changes Shift right in the supply curve Results in lower price and greater quantity S S’ Price D Quantity

Supply and Demand Curve Changes Shift left in the supply curve Results in higher price and less quantity S’ S Price D Quantity

Economics Supply & Demand Discuss affects of Increase in corporate taxes Change in consumer tastes Automation Promotion Download this book for free at: ttp://hdl.handle.net/10919/70961

Economics Supply & Demand Consider the market for lemonade. What happens when: There is a heat wave The price of sugar goes up The cost of a can of soda falls There is a baseball game on the street Download this book for free at: ttp://hdl.handle.net/10919/70961

Competition Perfect competition Monopolistic competition Many providers Standard product Many consumers Monopolistic competition Differentiated product

Competition Oligopoly Monopoly Natural monopolies Legal monopolies Few providers Many consumers Monopoly One provider Natural monopolies Legal monopolies