1. Microeconomics
Economics

2. Circular Flow of Economic Activity

3. Circular Flow of Economic Activity

4. Positive Relationship
Demand & Supply Curves
Inverse Relationship
Positive Relationship

5. Change in Quantity Demanded
The Law of Demand- Inverse Relationship between Price and Quantity Demanded
Change in Quantity Demanded due to a change in Price
Demand is the whole curve. Quantity Demanded is one point on the curve at a particular Price.

6. Change in Demand
Change in Demand due to one of the Determinants of Demand (absent of a price change)
Demand is the whole curve. Quantity Demanded is one point on the curve at a particular Price.

7. Change in Quantity Supplied
The Law of Supply-Positive Relationship between Price and Quantity Supplied
Change in Quantity Supplied due to a change in Price
Supply is the whole curve. Quantity Supplied is one point of production on the curve at a particular Price.

8. Change in Supply
Change in Supply due to one of the Determinants of Supply (absent of a price change)
Supply is the whole curve. Quantity Supplied is one point of production on the curve at a particular Price.

9. Equilibrium Pe= Price Equilibrium or Market Clearing Price
Qe= Quantity Equilibrium or Where Quantity Supplied is Equal to Quantity Demanded (Qs=Qd)

10. Demand and Supply Strips
Change in Related Goods
Income Change
Consumer Expectations
Tastes and Preferences
Number of Consumers
Increase in Demand
Decrease in Demand
Increase in Price
Decrease in Price
Increase in Quantity
Decrease in Quantity
Change in the Cost of Productive Resources
Government Regulations
Number of Sellers
Producer Expectations
Technology
Education
Increase in Supply
Decrease in Supply
Increase in Price
Decrease in Price
Increase in Quantity
Decrease in Quantity

11. Increase in Demand
D1 is the new Demand Curve. Increase in Demand due to one of the determinants.
New Equilibrium- Price increases (P1), Quantity increases (Q1).

12. Decrease in Demand
D1 is the new Demand Curve. Decrease in Demand due to one of the determinants.
New Equilibrium- Price decrease (P1), Quantity decreases (Q1).

13. Decrease in Supply
D1 is the new Demand Curve. Decrease in Demand due to one of the determinants.
New Equilibrium- Price decrease (P1), Quantity decreases (Q1).

14. Minimum Wage Laws in the States

15. Price Floor= Surplus Disequilibrium
Pf- Central Authority sets a Price Floor above the Equilibrium Price (Pe).
Quantity Supplied (Qs) is greater than Quantity Demanded (Qd) causing a surplus.
To Calculate a Surplus: Quantity Supplied minus Quantity Demanded

16. Nonbinding Price Floor
Price Floor (Pf) set below Price Equilibrium (Pe). Does not prohibit price from reaching Pe.

17. Price Ceiling= Shortage Disequilibrium
Pc- Central Authority sets a Price Ceiling below the Equilibrium Price (Pe).
Quantity Supplied (Qs) is less than Quantity Demanded (Qd) causing a shortage.
To Calculate a Shortage: Quantity Supplied minus Quantity Demanded

18. Nonbinding Price Ceiling
Price Floor (Pf) set below Price Equilibrium (Pe). Does not prohibit price from reaching Pe.

19. Business Organizations
Sole Proprietorship
Partnership
Both

20. Business Organizations
Partnership
Sole Proprietorship
Both
More Management Expertise-Specialization
Decision Making Requires Consensus
Multiple Owners: Shares Profit
Greater Access to Financial Capital (Money)
Quicker Decision Making
One Owner: Retains All Profit
Easiest and Least Expensive to Start
Difficult to Raise Money
Pride of Ownership
Unlimited Liability
Lower Taxes
Limited Life

21. Business Organizations

22. Business Organizations

23. Market Structures Monopolistic Competition Perfect Competition
Least
Competitive
Most
Competitive
Monopolistic Competition
Perfect Competition
Monopoly
Oligopoly
Examples:
Utilities- Water & Electricity
Automobiles
Telecommunications
Breakfast Cereals
Airlines
Restaurants
Hotels
Hair Salons
Agriculture

24. Market Structures

25. Market Structures