I need some assistance. Thank you.
1. Explain the difference between a movement along the demand curve and a shift in demand.
b. Explain the difference between a movement along the supply curve and a shift in supply.
c. What factors cause the supply curve to shift? Explain each factor.
d. What factors cause the demand curve to shift? Explain each factor. Can factors that effect demand also affect supply? Yes or No? Explain.
2. Explain the difference between the law of demand and the law of supply. What does the phrase 'other things equal" mean? Why do we need that?
3. What is a market? How have markets changed over the past 20-30 years?
Movement along the demand curve is a change in quantity demanded while a shift in demand moves the entire curve to a new location. The same applies to movement along vs a shift in the supply curve.
The supply curve shows a positive relationship between price and quantity supplied. The supply curve will shift in response to new technology, new resources, or a change in the cost of an input. In the long run, real GDP is restricted by the resources and technology used to make goods. Thus, increases in GDP will result if new resources are discovered, or better ways of utilizing them are implemented. Technology which creates new products, or improves the means of production for currently used products, will also expand GDP. Anything that reduces the cost of inputs will shift the long run AS curve outward. Because of the law of diminishing marginal returns, firms often face positively sloped supply curves. In the short run, each additional unit produced often costs the firm more than the prior one. This can because capital ...