Questions tagged [supply-and-demand]
Supply and Demand is an economic model of price determination in a market. Demand refers to how much (quantity) of a product or service is desired by buyers. Supply represents how much the market can offer.
0
votes
1answer
7 views
Which impact would have to introduce 15 times more soy in the worldwide prices of soy?
Soy is a commoditie and the main export of Argentina. It's said Argentina has 40 millions of hectareas of arable land and it produces food for 400 million persons and that potentially could make food ...
2
votes
1answer
19 views
Predicting Shifts in Supply and Demand for Loanable Funds
I know the answer is A. but I need an explanation on why. I thought government savings would decrease since they have less tax revenue, shifting savings left and interest rates up. I could see how ...
0
votes
1answer
21 views
Getting a market supply curve from firm supply curve
PFA the image below.
As there are n firms in the market, and a tax of t moves up the cost curves of an individual firm by t units, shouldn't the cost curve of the market move up by n*t units? If yes,...
1
vote
0answers
26 views
Economics of Selling Software
My understanding:
Normally, selling a product has an increasing marginal cost per unit produced. Very often this increases more and more due to poor allocation of resources (diminishing returns). ...
0
votes
1answer
25 views
Understanding what's in the frequently reported and discussed high demand in IT specialists in Germany - is the IT Fachkräftemangel real?
So far, I can observe the following contradictory evidences what I perceive from the media.
Statement group #1. In the press, there are repeated reports from different sources about missing ...
1
vote
0answers
35 views
Does the reciprocal of the price elasticity of demand have an interpretation?
I have 2 related questions that i think are straightforward but am worried I have over-simplified!
(i) Suppose the demand curve is downward sloping and the supply curve is upwards
sloping. Suppose ...
0
votes
0answers
18 views
Supply/Demand Shift (Find New Equilibrium)
Starting: supply curve $y=x+10$ and demand curve $y = -x+30$ with equilibrium at (10, 20).
The problem states that DEMAND shifts leftwards by 3 units and to find the new equilibrium. My professor did ...
0
votes
1answer
25 views
Demand Curve Price not perfectly elastic
I'm trying to make the argument that our Sales go up when prices for all our Products are 30% off. Which I believe should be our new Regular Price. but our Demand Curve doesn't support this. Should I ...
0
votes
0answers
28 views
Supply/Demand Curve Equation (beginner) [duplicate]
The linear demand function is $Q_D = a + b(P)$.
I understand from this thread that it can be thought of as a simplification/magnification of the overall demand curve.
Is there an equation that ...
0
votes
0answers
8 views
Building an square product-to-product table based on rectangular supply and use tables
I need a product-to-product input-output (I-O) table to conduct environmentally extended I-O analysis. I have supply and use tables at basic prices relating different industries and products, but ...
3
votes
1answer
55 views
Economics Behind the Insulin Shortage?
A lot of my family is concerned about a future insulin shortage and it's reported that this shortage is growing. When I read articles from Harvard about it, they imply it's pure greed:
There are ...
0
votes
1answer
38 views
By what means does prices changes?
The classical supply and demand theory states that prices and quantities of a given good (in a perfectly competitive market) are determined by the supply and demand of that good, a shift in the demand ...
0
votes
0answers
11 views
AMD and Intel duopoly
What kind of duopoly competition model do these two companies "follow"? I'm doing a work in which I aim to analyze the economic outcomes after Intel's chip shortage in november 2018.
Any links for a ...
1
vote
0answers
53 views
Origin of the saying “High prices are their own cure.”
Edwin Cannan (1915):
An old epigram says that high prices are their own cure.
Other variants of this "old epigram" include:
High prices cure themselves (1911).
High prices cure high prices ...
1
vote
1answer
42 views
Can Direct Taxes on the consumers have a impact on the Demand (rather than supply)?
I'm a 12th-grade student doing a school research paper evaluating the effectiveness of the recent increase in Additional Buyers Stamp Duty in the Singapore Housing market. This tax is directly imposed ...
1
vote
0answers
12 views
Supply elasticity on a piece-wise linear supply function
The supply elasticity at a point is the willingness to produce more or less after the price has changed (due to whatever reason?).
$$\mu_{Q,P}=\frac{\partial Q_S/Q_S}{\partial P/P}=\frac{\partial Q_S}...
1
vote
0answers
62 views
Real world examples of supply curve shapes
I get the basic intuition that at higher prices, produces would be willing to produce more, but I feel like theory can only take my understanding so far. I want to know what are the real world ...
1
vote
0answers
34 views
Which utility function yields following demand $\alpha p^{\epsilon}$ [duplicate]
I am looking for a utility function that will lead to the following demand
$$\alpha p^{\epsilon}$$.
I know it is most likely a CES utility since the elasticity of demand is constant and this is ...
0
votes
1answer
20 views
Are there more historical examples of big change in prices thanks to demand/supply changes like the tulip mania?
I'm currently searching for historical changes in prices as a result of a big/sudden change in demand/supply, like the tulip mania in Holland. Are there any notable examples?
2
votes
0answers
26 views
Positive effects of a Tunisia-EU free trade agreement?
Tunisia might be signing a free trade agreement with the EU very soon. It's called ALECA or DCFTA.
Many activists and labor unions are opposing such an agreement because it would result in losing ...
1
vote
1answer
29 views
Problem finding Demand Function
I am analyzing pricing for a new streaming service for a school project. My thought is to calculate the demand function of a player in the same industry and then calculate the optimal price. I am a ...
2
votes
1answer
129 views
Question on shifts in Supply and Demand Curves
I have a super basic question on the shift in supply and demand curves ( I haven't seen this stuff since high school). More generally, this is about solving systems of simultaneous equations.
We have ...
1
vote
3answers
38 views
If price increases and quantity remains the same can we infer that demand is perfectly inelastic?
My college tutor told me that demand for college admission at our institute is price inelastic. She says so, because, in the past 20 years, price of college education at our institute has increased, ...
2
votes
1answer
61 views
Is it right to derive social marginal benefit by adding individual prices instead of quantities?
I come across a lecture material on market functions and externalities that makes me quite confused. Here's the setup: Two stores are located next to each other. If one installs a camera system in ...
1
vote
1answer
536 views
Difference between Giffen and inferior goods. Why aren't all inferior goods Giffen goods?
What is the difference between an inferior good and a Giffen good?
Are the two following definitions for an inferior good equivalent?
Def 1: An inferior good is a good for which the demand decreases ...
0
votes
1answer
47 views
Flooding the real estate market with luxury homes: will average prices rise or fall?
If every middle class single-family detached home in a sprawling metropolitan area like Los Angeles were each replaced with two luxury condos over a short period, would average real estate prices rise ...
2
votes
2answers
70 views
What are “the fundamental categories of economics”?
I had an introductory class in marketing last week, and the professor wanted to test our previous knowledge of economics (we are juniors).
He asked us this simple question: "What are the fundamental/...
1
vote
1answer
68 views
Market demand independent of distribution of income
If preferences are identical and homogeneous, then show that market demand for any good must
be independent of the distribution of income.
My workings are as follows:
$$q^{d}(p)=\sum_{i=1}^{n}f(p_x,...
0
votes
1answer
168 views
Is there any formal definition of a relationship between resource availability and demand?
I do not have any background on economics. So my question might sound too simple and I hope it to be clear enough. I am curious about the following:
Is there any formal definition of a relationship ...
2
votes
1answer
279 views
Supply curve when the marginal cost is zero
The supply curve is built as the average marginal cost (MC), when the MC is equal or higher than the average cost (AC)
The marginal cost increases, as a result of the opposite effect of marginal ...
-1
votes
1answer
437 views
Find optimal price from demand function?
I've been struggling with this for hours, trying to figure out how to solve this.
"A perfectly competitive market has the marginal cost function, c (cost is C(y)=cy) and is facing the demand function:...
0
votes
1answer
55 views
Cross price elasticity of demand vs Price elasticity of demand
Is the cross price elasticity of demand between two goods always lower in magnitude than the price elasticities of demand of each good?
4
votes
1answer
78 views
Can marginal revenue be increasing?
As per my calculations, the derivative of the MR curve is given by:
MR'(q)=2p'(q)+qp''(q), where p(q) is the inverse demand curve. Therefore,for a downward sloping demand curve, if the second ...
3
votes
1answer
401 views
Demand Curve Equation Explanation
I've been reading (trying to brush up on my economics knowledge) and came across the equation: $q_D = a + b(P)$. The variable $a$ is explained as "factors other than price affecting demand."
I read ...
1
vote
0answers
11 views
Using capacity share instead of quantity market share in demand estimation (BLP)
If I were to use capacity share (as a proxy of quantity market share) in a demand estimation setup (such as BLP), are there ways to deal or interpret the measurement error? I would consider this ...
0
votes
2answers
27 views
A Question About The Laws Of Demand [duplicate]
The law of demand holds that ceteris paribis, a decrease of demand can be caused by an increase in price. However, it is also true that when demand decreases, the price will decrease, it will fall. ...
2
votes
2answers
118 views
Why can't the Land-Value Tax (in some cases) be passed on to tenants?
According to https://en.wikipedia.org/wiki/Land_value_tax:
Because the supply of land is essentially fixed, land rents depend on what tenants are prepared to pay,
That doesn't make any sense. If ...
0
votes
2answers
43 views
Does it make economic sense for only some universities in a certain area to pay their sports scholars?
Apparently
‘Athletic scholarships are common in the United States, but in many countries they are rare or non-existent.’
But are there countries where there are some universities that offer sports ...
1
vote
1answer
60 views
Why slope is constant in demand/supply curve?
I was reading Mankiw and it showed variation of demand/supply curve with external factors. However, in all the cases the curves only shifted but didn't change in shape. What I am wondering is why the ...
2
votes
5answers
560 views
Is Bill Gates wrong about supply demand curves?
In a recent tweet (Aug 14th, 2018, reproduced below), Bill Gates said that supply demand curves don't work for software because the first unit costs a lot and every unit after that is free. Isn't this ...
0
votes
1answer
37 views
How can you model/simulate the price/value of a good?
Let's say that you have a good which price can change quite often because of its demand. Let's assume that you developed an algorithm that changes continuously the supply of the good to make its value ...
0
votes
1answer
168 views
Short run Aggregate supply curve is horizontal or positively sloped?
I want to understand the adjustment process from Very short run production decision to Short run production decision to Long run production decision. As far as I've understood: consider an increase in ...
0
votes
1answer
45 views
Empiric evidence of abundance and post-scarcity either transition to it? [closed]
How much are concepts of post-scarcity and abundance economics just ideological/idealist or do we really observing their beginnings already?
For example:
healthcare: gets more and more expensive
...
-1
votes
1answer
55 views
Anti Piketty Confusing Movement Along Demand Curve with Shift
In Anti-Piketty, the author's claim that the statement
"If the supply of any good is insufficient and it's price is too high, then demand for that good should decrease which should lead to a decline ...
1
vote
2answers
88 views
What is a good way to generate realistic utility curves?
I am aiming to program a basic simulation of a simplified economy to look at the impact of various interventions.
The economy will have N groups of homogeneous consumers and M producer / employer ...
5
votes
4answers
371 views
Why not say the buyer will *definitely* buy at price X?
In supply-and-demand curve, we draw curves of indifference. Say the demand goes through (1, \$1). Then Bob the Buyer is indifferent between spending \$1 for 1 apple or just keeping the \$1. If Sally ...
4
votes
1answer
100 views
Why is the equilibrium price not anything between \$0 and \$200?
Consider the second problem below from Varian’s Intermediate Microeconomics:
Suppose that there were 25 people who had a reservation price of \$500, and the 26th person had a reservation price of \$...
0
votes
3answers
51 views
Will periodical increasing and decreasing cryptocurrency supply peg cryptocurrency to dollar effectivelly?
As far as I understand, in order to make cryptocurrency pegged to USD we need somebody to take the risks of exchange rates. So, if ratio CRYPTO to USD is at a given time 1CRYPTO:1,1 USD, then we ...
-1
votes
1answer
52 views
Question on money supply related to new crypto project
Following questions are related to a crypto project I am working on and proper answers are of utmost importance to this concept's development. I unfortunately lack expert knowledge about money supply ...
0
votes
2answers
84 views
Understanding the law of supply
In high school, I've never really questioned the law of supply, taking it as a given.
As I begin an introductory economics course in university, "relearning" the fundamentals of Economics, I realise ...
