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Change in Quantity demanded Movement along the curve Result of a change in the price

Change in Quantity demanded Movement along the curve Result of a change in the price Other factors remain constant. Change in Demand A shift in the curve Price remains constant One of the underlying factors change. D 2. D 1. A. $7. B. $5. 10. 18. 10. 15. Equilibrium Price -.

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Change in Quantity demanded Movement along the curve Result of a change in the price

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  1. Change in Quantity demanded Movement along the curve Result of a change in the price Other factors remain constant Change in Demand A shift in the curve Price remains constant One of the underlying factors change D2 D1 A $7 B $5 10 18 10 15

  2. Equilibrium Price - Equilibrium Quantity - Changes in Equilibrium D D S ? P P ? S D D S S

  3. Qd1= 10 – 50Pc + .3(100)+1.5(10)+.05(10) Eq. 2-3 • Qs1= -86+90Pc -1.5 (10)+.05(30)+.4(50) Eq. 2-6

  4. Qd2= 10 – 50Pc + .3(80)+1.5(28)+.05(8) Eq. 2-8 • Qs2= -86+90Pc -1.5 (10)+.05(102)+.4(80) Eq. 2-9 Find EQ P and EQ. Draw Graphs

  5. Chapter 11 Measuring Economic Activity • Business Cycle • Alternating periods of economic expansion and contraction Peak Recession Inflation Recovery Depression

  6. GDP • GDP measures the market value of final goods and services produced within a country’s border during a given time period

  7. Three approaches to measurement • Value added • Expenditure method • Income method

  8. Expenditure Method • GDP = C + I + G + (x - m) C =Personal consumption expenditure I =Gross private domestic investment G =Government consumption expenditures and investment (x-m)= net exports

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