ECON1101 Chapter Notes - Chapter 4: Ceteris Paribus, Demand Curve, Takers
Document Summary
What is a market: market: a group of buyers and sellers of a particular good or service, the buyers as a group determine the demand, the sellers as a group determine the supply. The goods offered for sale are all exactly the same. The buyers and sellers are so numerous that no single buyer or seller has any influence over the market prices. Markets that have only one seller and this seller sets the price is called a monopoly: price makers are monopolies vs price takers. If the demand for a good falls when income falls, the good is called a normal good. to an increase in quantity demanded. (cid:894)lu(cid:454)u(cid:396)(cid:455) goods, (cid:272)a(cid:396)s (cid:895) If the demand for a good rises when income falls, the good is called an inferior good. If factors of production get more expensive, the producer will not supply as much.
