Supply and Demand?

Question

1) IF the price of a good increases, what happends to demand?

2) If the price of a good decreases, what happends to supply?

3) Does a change in price create curve shifts?

Answer 1

The model of supply and demand uses the terms demand and quantity demanded to mean two different things. Demand refers to the quantity of a good demanded at different prices, while quantity demanded refers to the quantity demanded at one particular price. As a result, an increase in the price of a good decreases the quantity of that good, but demand does not change.

The analogous distinction is made between supply and quantity supplied. Accordingly, a decrease in the price of a good decreases the quantity of that good supplied, but supply does not change.

Changes in price elicit movements from one point to another along supply and demand curves. Changes in variables other than the price of good elicit shifts in supply or demand curves.

Answer 2

1) demand decreases following along on the demand curve

2) supply decreases following along the supply curve

3) No. The curves show the relationship of price and quantity. If you change one of those factors (price) you move along the curve. If you change anything but price or quantify, you shift the curve.

Answer 3

for a normal good answers to 1 and 2 would be decrease and increase respectively. However u have to take into consideration there are different types of goods. Look for "Giffen goods" for instance.

Answer 4

furnish is a common and open term on a similar time as the quantity presented is definitely a technical and academic term, furnish could be of armed forces, shape and so forth yet quantity furnish skill the financial and academic makes use of.