theoritical model how societies function

implementation of model broadly; relation to real world

classical liberal economist and scholar; formulating say’s law of markets

philosopher economist and politician; member of parliament

statistical and mathematical theories to economics

for satisfying various needs

consumers willing and able to buy

suppliers able to make available

FIVE MAIN FACTORS DETERMINE DEMAND

table shows quantity demanded

graphical representation of RELATIONSHIP

individual firm; steeper; narrower scope

all consumers of firm; flatter; broader scope

5 EXAMPLES OF APPLIED ECONOMICS

REASONS OF CHANGE IN DEMAND

against the law of demand

non luxury product

microeconomic law states that all other factors being equal

graphic representation of CORRELATION

Determinants of Supply

When the price of any product increases then its demand will fall. When its price decreases then its demand will increase in the market.

A shift of the demand curve when other factors change while price remains same

DETERMINANTS OF DEMAND

Products purchased by people in the higher income group to show status

INTERRELATED DEMAND

demand for a good is also affected by the price of its substitute

number of units of a product that a firm would be willing and able to offer for sale

“In the Economy, Information Education and motivation are everything”

influenced by big proponent of Adam Smith; taught political economy

proponent of classical theory; best known for 1848 work “Principles of Economy”