CHAPTER NO. 4
THE MARKET FORCES OF DEMAND AND SUPPLY
A place where buyers and sellers negotiate for buying & selling of goods & services.
Single person controls the market
Two persons hold the market
A market situation when there are about five to twenty sellers of a commodity in the market.
When there are more sellers than oligoply but less than perfect competition (less than 100)
Perfect competition/ perfect market/ free market
100+ sellers, price taker, open entry & exit, total awareness, price set by demand & supply.
Willness to purchase + powers to purchase
Demand of a single person.
Agregate of all individual demands.
Law of demand
When price of a commodity increases, its demand decreases and vice versa.
Quantity of a good offered for sale in the market on a particular time.
Law of supply
When price of a commodity increases, oits supply also increases, and vice versa.
Market equilibrium/ demand and supply together
A situation when the quantity demanded and supplied become equal.
Price at equilibrium point.
Quantity demanded and supplied at equilibrium point.
Goods whose demand decreases with the increase in incomes of people and vice versa.
Goods whose demand increases wih the increase in incomes of people and vice versa.
Goods whose demand decreases with the increase in their prices and vice versa.
Goods whose demand increases with the increase in their prices and vice versa.
Goods which can be use in place of each other, like floor and rice.
Goods which cannot be...