Supply and Demand:
An Initial Look
,THE INVISIBLE
HAND
• Invisible hand is a phrase used by Adam Smith to describe how, by
pursuing their own self-interests, people in a market system are “le
by an invisible hand” to promote the wellbeing of the community.
• Interaction between buyers and sellers
, DEMAND AND QUANTITY DEMANDED
• The quantity demanded is the number of units of a good that consumers are
willing and can afford to buy over a specified period of time.
• The quantity demanded of any product normally depends on its price.
Quantity demanded also depends on a number of other determinants,
including population size, consumer incomes, tastes, and the prices of other
products.
• A demand schedule is a table showing how the quantity demanded of some
product during a specified period of time changes as the price of that
product changes, holding all other determinants of quantity demanded
constant
• A demand curve is a graphical depiction of a demand schedule. It shows how
the quantity demanded of some product will change as the price of that produ
changes during a specified period of time, holding all other determinants of
quantity demanded constant.
An Initial Look
,THE INVISIBLE
HAND
• Invisible hand is a phrase used by Adam Smith to describe how, by
pursuing their own self-interests, people in a market system are “le
by an invisible hand” to promote the wellbeing of the community.
• Interaction between buyers and sellers
, DEMAND AND QUANTITY DEMANDED
• The quantity demanded is the number of units of a good that consumers are
willing and can afford to buy over a specified period of time.
• The quantity demanded of any product normally depends on its price.
Quantity demanded also depends on a number of other determinants,
including population size, consumer incomes, tastes, and the prices of other
products.
• A demand schedule is a table showing how the quantity demanded of some
product during a specified period of time changes as the price of that
product changes, holding all other determinants of quantity demanded
constant
• A demand curve is a graphical depiction of a demand schedule. It shows how
the quantity demanded of some product will change as the price of that produ
changes during a specified period of time, holding all other determinants of
quantity demanded constant.
