#cfa #cfa-level-1 #economics #microeconomics #reading-14-demand-and-supply-analysis-consumer-demand #study-session-4-microeconomics-analysis
In the model of demand and supply, we assumed the existence of a demand curve and a supply curve, as well as their respective negative and positive slopes. That simple model yielded some very powerful implications about how markets work, but we can delve even more deeply to explore the underpinnings of demand and supply. In this reading, we examine the theory of the consumer as a way of understanding where consumer demand curves originate. In a subsequent reading, the origins of the supply curve are sought in presenting the theory of the firm.