Economics 3

  • Created by: Gabrielle
  • Created on: 29-12-13 16:12
View mindmap
  • The Market System
    • Market Forces - determine quantity & price
      • Demand
      • Supply
    • Competitive Market - many buyers and sellers
      • Perfectly competitive
        • Homogenous goods meaning buyers have no preference
        • Price takers: Numerous buyers and sellers each unable to influence prices
    • Oligopoly
      • A few sellers not always aggressively competing with each other
    • Imperfect or monopolistic market:
      • Many sellers each offering a slightly different product
    • Supply
      • The amount that sellers are willing and able to sell
      • A movement along the supply curve is caused by a change in price
      • A shift in the supply curve is caused by a factor affecting supply other than change in price
        • Input prices
        • Technology
        • Number of sellers
        • Social Factors
    • Demand
      • Amount of the good that buyers are willing and able to purchase at a given price level
      • A movement along the demand curve occurs when there is a change in price
      • Movement in the demand curve is caused by a factor affecting demand other than a change in price
        • Income
        • Price of substitute or complementary goods
        • Tastes
        • Expectations
        • Size of population
    • Above  equilibrium price = surplus Below the equilibrium price = shortage
    • E =QS=QD


No comments have yet been made

Similar Economics resources:

See all Economics resources »See all The Market System resources »