Lecture 5 Market Equilibrium: State of Balance Between Demand  Supply

Lecture 5 Market Equilibrium: State of Balance Between Demand Supply PowerPoint PPT Presentation


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Lecture 5 Market Equilibrium: State of Balance Between Demand Supply

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1. 1 Lecture 5 Market Equilibrium: State of Balance Between Demand & Supply

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5. 5 Example 1: What happens in the U.S. beef market when people become crazed with the Atkins diet?

6. 6 Example 2: What happens in the U.S. beef market when Canadian imports are banned because of Mad Cow Disease?

7. 7 Example 3: What happens in the U.S. beef market when people become crazed with the Atkins diet at the same time Canadian imports are banned because of Mad Cow Disease?

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11. 11 EOL Assignment Describe the forces that move price toward equilibrium when there is a shortage in a market. Describe the forces that move price toward equilibrium when there is a surplus in a market. Draw a graph that shows the effect on equilibrium price and quantity in a market that experiences an increase in demand. Draw a graph that shows the effect on equilibrium price and quantity in a market that experiences an increase in supply. What happens to equilibrium price and quantity in the french fries market if the demand decreases because people become more health conscious and the supply decreases because blight ruins the potato harvest?

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