1. Supply and Demand

2. Economic definitions for DEMAND
Demand: the total amount consumers are willing and able to buy at all prices.

3. Demand curve: the graphical representation of what consumers are willing and able to buy.

5. Law of Demand: As price increases/decreases, quantity demanded decreases/increases.
P Q P Q

6. Factors that cause demand to change or shift
Tastes and fads
Income
Number of buyers
Future price expectations
Price and availability of:
Substitutes
compliments

7. Inelastic Demand: Price still moves up and down but Demand stays the same

9. Economic definition for SUPPLY
Supply: the total amount of a good or service producers are able to make at all prices.

10. Supply curve: the graphical representation of a good or service producers are able to make at all prices.

12. Law of Supply: as price increases/decreases, quantity supplied increases/decreases
P Q P Q

13. Factors that cause a change in supply:
Price of land, labor or capital
Technology
Number of other sellers
Price of other goods I could produce
Tax policy

14. Equilibrium Point: the point at which the quantity & the price are equal

17. IRDL
“IRDL” will help you!
INCREASE = RIGHT
DECREASE = LEFT