#cfa #cfa-level-1 #economics #microeconomics #reading-13-demand-and-supply-analysis-introduction #study-session-4 #summary
Demand and supply curves are drawn on the assumption that everything except the price of the good itself is held constant (an assumption known as ceteris paribus or “holding all other things constant”). When something other than price changes, the demand curve or the supply curve will shift relative to the other curve. This shift is referred to as a change in demand or supply, as opposed to quantity demanded or quantity supplied. A new equilibrium generally will be obtained at a different price and a different quantity than before. The market mechanism is the ability of prices to adjust to eliminate any excess demand or supply resulting from a shift in one or the other curve.
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SUMMARYs and households as sellers of land, labor, capital, and entrepreneurial risk-taking ability. Capital markets are used by firms to sell debt or equity to raise long-term capital to finance the production of goods and services.
<span>Demand and supply curves are drawn on the assumption that everything except the price of the good itself is held constant (an assumption known as ceteris paribus or “holding all other things constant”). When something other than price changes, the demand curve or the supply curve will shift relative to the other curve. This shift is referred to as a change in demand or supply, as opposed to quantity demanded or quantity supplied. A new equilibrium generally will be obtained at a different price and a different quantity than before. The market mechanism is the ability of prices to adjust to eliminate any excess demand or supply resulting from a shift in one or the other curve.
If, at a given price, the quantity demanded exceeds the quantity supplied, there is excess demand and price will rise. If, at a given price, the quantity supplied exceed Summary
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