01:220:102 Chapter Notes - Chapter 3: Demand Curve, Inferior Good, Normal Good

• School: Rutgers University
• Department: Economic
• Course: 01:220:102
• Professor: J A C K Skydel

Document Summary

3. 1 supply and demand: a model of competitive market. A competitive market is a market in which there are many buyers and sellers of the same good or service. No individual"s actions have a noticeable effect on the price at which the good or service is sold. This is not an accurate description of every market. When a market is competitive, its behavior is well described by the supply and demand model. In general the good or service that people want to buy, depends upon the price. The higher the price, the less of the good or service people want to purchase; alternatively, the lower the price, the more they want to purchase. The demand schedule is a table showing how much of a good or service consumers will want to buy at different prices. The quantity demanded is the actual amount consumers are willing to buy at some specific price.