Matakuliah
Tahun
: J0594-Teori Ekonomi
: 2009
DEMAND, SUPPLY, AND MARKET
EQUILIBRIUM
Pertemuan 3
Market
Market bring together buyers (“demander”) and seller
(“supplier)
Some markets are local, other are national or international.
Some are highly personal, involving face-to-face contact
between demander and supplier, other are faceless, with
buyer and seller never seeing or knowing each other
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Demand
Demand is a schedule or curve that shows the various
amount of product that consumer are willing and able to
purchase at each of series of possible price during a
specified of time
The Law of Demand
The law of demand states that, other things equal, the
quantity of good purchased varies inversely with its price
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Individual Demand
6
P
$5
Qd
10
4
20
3
35
2
55
1
80
5
Price (per bushel)
Individual
Demand
4
3
2
1
0
D
10
20
30
40
50
60
70
80
Quantity Demanded (bushels per week)
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Individual Demand
Demand Can Increase or Decrease
An Increase in Demand
Means a Movement
of the Line
P
6
Individual
Demand
Qd
$5
10
4
20
3
35
Price (per bushel)
P
5
A Movement Between
Any Two Points on a
Demand Curve is Called a
Change in Quantity
Demanded
4
3
2
D2
2
55
1
1
80
0
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Decrease in Demand
2
4
6
8
10
D1
D3
12
14
16
18
Quantity Demanded (bushels per week)
6
Supply
Supply is a schedule or curve that shows the various
amount of product that producers are willing and able
tomake available for sale at each of series of
possible price during a specified period
The law of Supply
A Positive or direct relationships thet prevails between
price and quantity suplied. As price rises , the quantity
supplied rises; as price falls, the quantity supplied falls.
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Individual Supply
Determinants of Supply
•
•
•
•
•
•
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Resource Prices
Technology
Taxes and Subsidies
Prices of Other Goods
Producer Expectations
Number of Sellers
8
Individual Supply
P
6
Individual
Supply
Qs
60
4
50
3
35
2
20
5
Price (per bushel)
P
$5
S1
4
3
2
1
1
5
0
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10
20
30
40
50
60
70
Quantity Supplied (bushels per week)
Q
9
Individual Supply
Supply Can Increase or Decrease
A Movement Between
Any Two Points on a
Supply Curve is Called a
5
Change in Quantity
Supplied
6
P
Qs
$5
60
4
50
3
35
2
Price (per bushel)
Individual
Supply
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S2
4
3
2
An Increase in Supply
Means a Movement
of the Line
20
1
1
S3
5
0
2
4
6
8
10
12
14
Quantity Supplied (bushels per week)
Q
10
Market Equilibrium
200 Buyers & 200 Sellers
Market
Demand
200 Buyers
$5
4
3
2
1
Qd
2,000
4,000
7,000
11,000
6
6,000 Bushel
Surplus
5
Price (per bushel)
P
S
$4 Price Floor
4
3
$2 Price Ceiling
2
16,000
7,000 Bushel
Shortage
1
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Market
Supply
200 Sellers
0
2
4
6 7 8
10
P
Qs
$5
12,000
4
10,000
3
7,000
2
4,000
1
1,000
D
12
14
16
18
Bushels of Corn (thousands per week)
11
Market Equilibrium
Price Quantity
• Supply Increase;
Demand Decrease
• Supply Decrease;
Demand Increase
• Supply Increase;
Demand Increase
• Supply Decrease;
Demand Decrease
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