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Supply & Demand
Economics 101Key Concepts
- Supply: what producers offer at a given price.
- Demand: what consumers are willing to buy.
Equilibrium
- Where supply meets demand.
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“So, um, supply is what producers are willing to sell at a price. Demand is what people want to buy… as prices rise, demand usually falls, and supply rises. Where they meet—that’s equilibrium.”
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Economics 101 — Lecture Notes
Key Concepts
- Supply: what producers are willing to sell at a given price.
- Demand: what consumers are willing to buy.
- As prices rise, demand usually falls and supply rises.
Exam Note
Explain how a change in price affects supply and demand, then identify the equilibrium point.
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Messy transcript
Okay so today we’re gonna talk about supply and demand. So, supply is basically how much producers are willing to sell at a certain price, right? And demand is how much consumers want to buy, uh, at a certain price. So when the price goes up, usually demand goes down… and supply goes up.
Let me give you an example… if the price of coffee increases, then fewer people will buy it, right? So that’s a decrease in quantity demanded. And on the supply side, producers are more willing to sell because they can make more profit.
The equilibrium is where supply and demand intersect. Um, and if there’s like a shift in demand, for example due to changes in income or preferences, then the equilibrium price will change too. This is really important, so please remember this because it’ll probably be on the exam.
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Supply & Demand
Key Concepts
- Supply: the quantity producers are willing to sell at a given price.
- Demand: the quantity consumers are willing to buy at a given price.
- As price increases, quantity demanded usually falls and quantity supplied rises.
Equilibrium
The point where supply and demand intersect: quantity supplied equals quantity demanded.
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