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Resume Introduction To Economic 4

1) The document discusses the economic concepts of supply and demand, including definitions of demand and supply, demand and supply schedules, and demand and supply curves. 2) It explains factors that influence demand, such as price, income, and consumer tastes, and factors that influence supply, such as price, production costs, and available resources. 3) Market equilibrium is defined as the price and quantity where the amounts demanded and supplied are equal, resulting from the interaction of supply and demand forces. Disequilibrium can result in excess supply or excess demand and lead to price changes toward equilibrium.

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M Hoqqil Fatwa
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85 views4 pages

Resume Introduction To Economic 4

1) The document discusses the economic concepts of supply and demand, including definitions of demand and supply, demand and supply schedules, and demand and supply curves. 2) It explains factors that influence demand, such as price, income, and consumer tastes, and factors that influence supply, such as price, production costs, and available resources. 3) Market equilibrium is defined as the price and quantity where the amounts demanded and supplied are equal, resulting from the interaction of supply and demand forces. Disequilibrium can result in excess supply or excess demand and lead to price changes toward equilibrium.

Uploaded by

M Hoqqil Fatwa
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Name : Muhammad Hoqqil Fatwa

NIM : 19522214

CHAPTER 4

The Market Forces


of
Supply and Demand

RESUME:
DEMAND THEORY
To study demand theory (Demand) there are three approaches, namely:
1. Definition of Demand: in the form of definition.
2. Demand Schedule: in tabular form.
3. Demand Curve: in graphical form.

A. Definition of Demand
Demand is the buyer's preference to buy a certain number of goods at a certain price
level.
The condition of consumer demand is influenced by two factors, namely:
The desire to consume goods and services (willingness to consume)
The ability to realize the desire to consume (ability to consume)

There are two definitions of demand according to the subject:


a. Individual Demand
b. Collective Demand

B. Demand Schedule
Demand Schedule is a list (table) that shows the relationship between the various
quantities of goods x requested at various price levels x applicable.

C. Demand Curve
From the Demand Schedule discussed earlier, we can draw a curve called the Demand
curve.
Demand Curve is a tool used in the form of a graph that illustrates the position of the
point that connects the various quantities of goods requested at various price levels.
The shape of the demand curve is negative slope / downward slope or downward from
top left to bottom right. this can be proven by the ratio of price increases and the quantity of
goods demanded.

D. Factors Affecting (Determinants) of Demand


The factors that influence demand include:
1. Price of the item itself (Px)
2. Prices of other goods that are closely related to the goods (prices of replacement or
complementary goods) (Py)
3. Community income (M)
4. Distribution of community income (Mb)
5. Community taste (T)
6. Total population (Po)
7. Forecast in the future (expectation) (E)

SUPPLY THEORY

To study supply theory three approaches are used:


1. Meaning of Supply: in the form of definition
2. Supply Schedule: in tabular form
3. Supply Curve: in graphical form

A. Definition of Supply
Supply is the seller's willingness regarding the amount of goods to be sold at a certain
price level. Who learn about the relationship of the amount of an item offered to the price
level.

B. Supply Schedule
The Bid function can be used in the following Supply Schedule table form:
Supply Schedule is a list that shows the relationship between various quantities of goods
offered at various price levels.

C. Supply Curve
From the previous Supply Schedule or Supply Function it can be described in the form of
a curve called the supply curve.
Supply Curve is a place of the possible points that connect between the various
quantities of an item offered at various price levels.
The supply curve is a positive slope or rises from the lower left to the upper right.
This can be proven from the ratio of price increase with the addition of the number of
goods offered is positive

D. Factors Affecting the Offer


The factors that affect the Bid include:
1. Price of the item itself (Px)
2. Prices of other goods that have a relation (rival) to the goods themselves (replacement
goods) (Py)
3. Economic resources (R)
4. Technology (T)
5. Production Costs (C)
6. and other factors

BALANCE REQUESTS AND OFFERS


The basic theory of balance occurs or is determined by the interaction between market
demand and market supply that will determine the market price that occurs or called Price
Equilibrium. Because the price level that occurs is agreed by both parties (seller and buyer),
then: PDx = PSx

In this situation, there is also a balance in the amount of goods traded by both parties,
called Quantity Equilibrium or QDx = QSx.
If the price that occurs is greater than the equilibrium price or P1> P, then QSx> QDx
means there is no balance or is called Disequilibrium. The difference between QSx and QDx
can be called excess supply (Excess Supply).
As a result of Excess Supply will cause competition between sellers which causes the
price level to fall until it reaches balance again when PSx = PDx and QDx = QSx or Market
Equilibrium.
If the price is smaller than the balance price or P2 <P, then QSx <QDx. Means if there is
no balance or is called Disequilibrium. The difference between QDx and QSx can be called
Excess Demand.
As a result of Excess Demand competition will arise between buyers which causes the
price level to rise until it reaches balance again when PSx = PDx and QDx = QSx or Market
Equilibrium.

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