Demand & Supply Cheat Sheet
Demand Curve Supply Curve
The quantities of a good demanded at a range of prices in a particular time period. The quantity of output a firm produces at the various prices of the good
The Law of Demand The Law of Supply
An inverse relationship between a good’s price and the quantity demanded. A direct relationship between a good’s price and the quantity produced.
Quantity Demanded (Qd) Quantity Supplied (Qs)
A Price is a movement along the Demand curve
A Price effects Quantity Demand not Demand
A in Price is a movement along the Supply
curve
A Price effects Quantity Supplied not Supply
Demand - Downward Sloping Supply – Upward sloping
INCOME EFFECT
P Income buy more
DMU
Consumption utility
SUBSTITUTION EFFECT
P switch to cheaper good
PROFIT EFFECT
P , Profit
COST EFFECT
Supply , Costs
Demand Curve Shift – TRIBE Supply Curve Shift – STORES
Tastes & Preferences Subsidies or # of Sellers
Demand Increase Demand Decrease Supply Increases Supply Decreases
More wanted - Demand Less wanted - DemandSubsidies, S , Firms , SSubsidies, S, Firms, S
Related Goods Prices – Substitutes & Compliments Technology & Taxes
Demand Increase Demand Decrease Supply Increases Supply Decreases
Substitutes - P(A) D(B)
Complements – P(A) D(B)
Substitutes – P(A) D(B)
Complements – P(A) D(B)
Technology , S
Taxes, S
Technology , Supply
Taxes , S
Income (Y) Other Related Good’s Prices
Demand Increase Demand Decrease Supply Increases Supply Decreases
Normal Good - Y D
Inferior Good – Y D
Normal Good - Y D
Inferior Good - Y D
Jointly Sup. Price, Supply
Comp. Sup. Price, Supply
Jointly Sup. Price, Supply
Comp. Sup. Price, Supply
Buyers (Population) Resource Costs
Demand Increase Demand Decrease Supply Increases Supply Decreases
Population , DPopulation , DCosts , SupplyCosts, Supply
Expectations of a future change in Income or Prices Expectations of Price of Good Sold
Demand Increase Demand Decrease Supply Increases Supply Decreases
Consumer Incomes , D
Future Prices of good , D
Consumer Incomes , D
Future Prices of good , D Expect Prices of Good , SExpect Prices of Good , S,
Market Equilibrium (Shifting and the Effects on Price & Quantity)
Demand P&Q Demand P&Q Supply P& Q Supply P& Q Of Supply & Demand
D& S then P uncertain & Q
D& S then P & Q uncertain
D& S then P & Q uncertain
D& S then P uncertain & Q
