Question

Hi please help with these

1. Explain who and what demand and supply represent?
2. What is the difference between demand and quantity demanded, and supply and quantity supplied?
3. What are the Law of Demand and the Law of Supply, and explain why price and quantity demanded are inversely related, and why price and quantity supplied are directly related?
4. List the major determinants of demand, and explain how a change in each will affect the demand curve.
5. List the major determinants of supply, and explain how a change in each will affect the supply curve.
6. Explain the concept of equilibrium price and quantity.
7. What is productive and allocative efficiency, and explain how competitive markets achieve them.

Answer 1

1) Answer: Demand and supply is one of the most vital concepts in economics. Demand represents the ability and desire of consumers to purchase a good at a range of different prices. Supply represents the amount of a good which the producers are willing to offer for sale at a different range of prices. The price at which the demand and supply curves intersect is termed to be an equilibrium at which all of the good that is offered will be purchased

　

2) Answer: Demand refers to the entire range of prices while quantity demanded refers to the amount of good, service, or resource that people will be able and willing to buy during a specified period at a specified price

Supply refers to the sum of all goods produced across all prices while quantity supplied refers to an amount of goods produced at a specific price

　

3) Answer: Law of Demand states other things remaining constant:

-- If the price of a good increases, the quantity demanded of that good falls.

-- If the price of the good decreases, the quantity demanded of the good rises.

Thus price and quantity demanded are inversely related

Law of Supply states other things remaining constant:

-- If the price of a good increases, the quantity supplied of that good also increases.

-- If the price of the good decreases, the quantity supplied of the good also increases.

Thus there is a positive relationship between price and quantity