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Household
Sector
Business Sector
Factors of
Payments
Payment fro
Purchase of
G&S
Scarcity
Refers to the condition that all
resources are available only in limited
supply.
Law of Scarcity
States
Societys
resources: (Factors of
Production)
Natural gifts (land, forest, minerals)
Human (mental & physical)
Manufactured aids (tools, machinery,
buildings)
Commodities
Refers to the things that are produced
Can be Goods & Services
Goods
Tangible
Services
Intangible
options
Refers to the foregone value of
the next best alternative
Value of what is given-up when
one makes choice
Demand
Pertains
Quality Demand
The amount of goods or services consumers
are willing and able to buy/purchase at a
given price, place and period of time
Law of Demand
Price
increases, quantity
demanded decreases and as the
price decreases quantity demand
increases
Relationship of price and
quantity, law observed
regularity in the market
Validity of the Law of demand
Ex.
Effect
Effect
Determinants of Demand
Consumers
Income
Consumers
Expectation of Future
prices
Quantity of a good demanded within
any period depends not only on
prices in that period but also on
prices expected in future periods.
Prices
of Related Products
Complimentary Products
Goods that go together or can be use without the other
Consumers
Demand
Schedule
QUANTITY
DEMANDED
(CALLS PER
MONTH)
30
25
7
3
1
0
Demand Curve
a
QUANTITY
DEMANDED
(CALLS PER
MONTH)
30
25
7
3
1
0
SUPPLY
The
maximum units/quantity of
goods or services producers can offer
Quantity supplied
Refers to the amount or quantity of goods and
services producers are willing and able to
supply at a given time.
Law of Supply
As
Determinants of Supply
Change
in Technology
Cost of Inputs Used
Inc in price of the input or cost of
production decreases quantity of supply
Expectation
of Future Price
Price of Related products
Government Regulation and Taxes
Government Subsidies
Number of firms in the market
Supply Schedule
A
Supply Curve
A supply
Market Equilibrium
A
Price Control
Price
Ceiling
Price
Floor