1 / 6

Test Yourself

Price. S. P *. D. Q * Quantity. Test Yourself. Which is more important in determining market equilibrium supply or demand? Is it utility or cost of production that determines value?. Answer – both are important

niyati
Download Presentation

Test Yourself

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Price S P* D Q* Quantity Test Yourself Which is more important in determining market equilibrium supply or demand? Is it utility or cost of production that determines value? Answer – both are important “We might as reasonably dispute whether it is the upper or lower blade of a pair of scissors that cuts a piece of paper, as whether the value is governed by utility or cost” Alfred Marshall 1920 p. 348

  2. Test Your Self A What happens if demand decrease from D1to D2? D What is new equilibrium point? Why? What is CS before / after? What is PS before / after? What is TS before / after? B F H G C E D1 D2

  3. Test Your Self A What happens if demand decrease from D1to D2? D What is new equilibrium point? Why? Equilibrium points – B to C What is CS before / after? What is PS before / after? What is TS before / after? B F H G C E D1 D2

  4. Test Your Self A What happens if demand decreases from D1to D2? D • What is new equilibrium point? Why? • Equilibrium points – B to C • What is CS before / after? • ABF to DCG • What is PS before / after? • What is TS before / after? B F H G C E D1 D2

  5. Test Your Self A What happens if demand decrease from D1to D2? D What is new equilibrium point? Why? Equilibrium points – B to C What is CS before / after? ABF to DCG What is PS before / after? EBF to ECG What is TS before / after? B F H G C E D1 D2

  6. Test Your Self A What happens if demand decreases from D1to D2? D • What is new equilibrium point? Why? • Equilibrium points – B to C • What is CS before / after? • ABF to DCG • What is PS before / after? • EBF to ECG • What is TS before / after? • EBA to ECD B F H G C E D1 D2

More Related