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SUPPLY AND DEMAND

 Market equilibrium- is a market state where the supply in the market is equal to the demand in the market. The equilibrium price is the price of a good or service when the supply of it is equal to the demand for it in the market. 
More information about market equilibrium in the link below

https://www.khanacademy.org/economics-finance-domain/microeconomics/supply-demand-equilibrium/market-equilibrium-tutorial/v/market-equilibrium

 Demand- quantities that people are willing and able to buy at various prices

The law of Demand-  states that there is an inverse relationship between price and quantity demanded

*one thing that causes a change in quantity demanded is a change in price

 Factors that causes "change in Demand"

  1. Change in buyer's taste- this could range from a viral outbreak to something simple like buyer preference.
  2. Change in the number of buyers- this mainly pertains to the change of population in a given area. This can result from several things, the main one being a migration of immigrants or vice versa.
  3. Change in income- this is strictly talking about income which is mainly affected by government control factors, or when the economy changes.
  4. Change in price of related goods- this results whenever a type of good decides to change its price based on a competitor or based on what the owner wants. There are two main types of goods. One being Substitute ,which is a new type of good, and the other being complimentary which ,as the name, states means that the good goes with something else. A good example of complimentary is Fries with Burgers. 
  5. Change in expectations- this is talking about whenever something out of proportions occurs at that very moment, such as a bug infestation of crops.Image result for demand schedule

Supply- The quantities that are produced and are able to sell at various prices

The law of supply- states that there is a direct relationship between price, and the quantity supplied

*one thing that causes a change in quantity supplied is the price of the object

Factors that causes "change in Supply"

  1. Change in the number of sellers/supply-  this directly talks about the number of people who can produce a product and manage how much is being sold. A good example of this is a factory that produces toys for kids.
  2. Change in cost of production/ resource price- this correlates with how much it takes to make something. This can be affected by many changes. One example is that steel becomes scarce in a given area and now is more expensive to use in constructing houses.
  3. Change in technology- the name says it all. Whenever new technology comes up it either benefits or causes a great deficit in production. Mostly it will be a benefit in the economy. 
  4. Change in weather- The weather can play a major factor in what is being produced. A passes by a farm causing the amount of crops produced to be decreased. 
  5. Change in taxes subsidies- this mostly relates to government funded projects to make something happen such as new roads for the state. 
  6. Change in expectations (future)- something that changes the production or item value based on what is going to happen in the near future. An example is the cost of a computer will decrease by 10% in 2 months making it so buyers are more inclined to wait longer in order to buy the product. Image result for supply schedule

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