Lecture 4

Buyser snad sellers coming together to exhcange goods/services
Buyers determine the demand for the product
Sellers determine the supply of the prodcut

Buyers and sellers in exact same room and exact same time buying and selling goods

Sepeared locations selling and buying but all locations contirbute to overall market

Factors that prevent new firms from entering the market

To serve alcohol at a restuarant, you must obtain an alcohol permit from department of alcohol and beverage control

Amazon has large shipping infrastructure, direct competetion to amazon is a barrier to entry because they have such large infrastructure and therefore the advantage

Forces that make market economies work. Refers to behavior that people use when they interafct with one another in markets

1.) Market where there are many buyers and many sellers
2.) Both buyers and sellers have negligible impact on prices
3.) Price and quanity determined by both buyers and sellers

No one has complete control over price of market goods (Price Takers)

One seller, one good, control over price

Small group of sellers that control prices

Many firms trying to get consumers to buy their good over their competitors

Willingness and ability of buyers to buy different quanitites of a good
Relationship between price of a good and quanity demanded of a good (How much is demanded)

Number of units of a good that individuals are willing and able to buy at a price

Price rise, demand of qunaity for good falls
Price falls, more is consumed

Words
Symbols
Demand Schedule
Demand Curve

Table givign data points

Downward sloping price
Take demand scheudle and turn into demand curve
Price decrease, quanity demand increases

All individual demand curves in a market added up to make market demand curve
Total quanity of goods varies between individual demand curves
Quanity on X axis | Price on Y axis ALWAYS

Movmement on the demand curve form one point to another caused by a change in the price of a good or service

Shift in demand curve (When entire demand curve shfits left or right; overall quanity demand change at every single price)

How much money someone makes influences the choices someone makes when making purchases in the market

Good when demand rises as income increases | Income decreases, demand decrease

Income increases, demand decreases

Income increase/ decrease , Demand has no change