demand: quantity and willingness to buy customersa) desire to
acquire itb) willingness to buyc)ability to paylaw of demand:
quantity of good change inversely to that of priceexception to law
of demand (giffen Goods)1) Giffen good: people parodixcally consume
more as price riseseg Iris potato famine : potato as giffen good as
price inceraesd demaand increased2) Veblen effect:concepts of
conspicious consumption and satus seekingeg: more expensive the
commodities higher the value becomes status symbol3) prediction4)
expection of change in price of commodity5) share marketDemand
Schedule: relationship btwn price of good and qty demandedDemand
Curve: graph of price of good and quantity demandedfactors
influencing demand1. price of good2. Income of consumers3. Price of
related goods4. Taste pattern of consumer5. Expected future price
of product6. Number of consumers in marketprice and quantity
inverseincome direct for normal goods and inverse for inferor
goodsrelated price : direct for substitutes inverse for
complimentstaste pattern direct expected future price directn:
directchange in quantity demanded: occurs when price
changesMovement alonfg demand curvechange in demand: occurs when
one of variable s changesdprice: movement along demand curveFactors
influencing supply:1. Price of good2. Input prices3. Prices of
related goods4. Technological advances5. Expected future price6. no
of firms producing productMarket equilibrium: quantity demanded=
quantity suppliedSurplus: when price> equilibrium price quantity
supplied>quantity demandedThere is excess supply or
surplussuppiers will lower price to increase sales moving towards
equilibriumShortage: price quantity suppliedso raise pricenecessity
goods: price inelasticnecessities
