ECON 1116 Lecture Notes - Lecture 3: Economic Equilibrium, Business Opportunity, Bretton Woods System
16 Nov 2016
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Markets: when buyers and sellers set prices and quantities, enables buyers and sellers to exchange g and s, institutional arrangements (ex: to promote progress markets are institutions too) Don"t need a place to have a market- Nasdaq is a bunch of computers connected into a virtual place. Barter exchanges: barter- need to have simultaneous wants hard. Money exchanges: money facilitates efficiency- easier! More transactions: money is anything buyers and sellers accepts for transactions, money- iou of the gov. *bretton woods system- we deal oil in dollars. Relative price defines price of a g or s in terms of another measures opp cost: 2 for 1, 1 for 2, smith and marx- labor"s wage is what is used to compare everything to it . Amount of a product that people are willing and able to purchase at every poss price. Inverse relationship b/w price and dem: everything else held constant. Dem schedule- table of prices and corresponding quantities demanded.
