As Economics Unit 1 Revision Essay

1871 words - 8 pages

Demand: the quantity of a product that consumers are able and willing to purchase at various prices over a period of time
Market: where or when buyers and sellers meet to trade or exchange products.
It is important to remember that a want and demand are entirely different what consumer’s want they may not actually purchase.
Notional Demand: The desire for a product
Effective Demand: The willingness and ability to buy a product
The definition of demand assumes that the only factor affecting demand is price, economists refer to this as ceteris paribus
Ceteris Paribus: Assuming other variables remain unchanged
The relationship between demand and quantity is INVERSE
CONSUMER ...view middle of the document...

Change in Demand Due to: | Effect on Demand Curve |
An increase in consumer incomeA rise in price of substitutesA fall in price of complementsA positive change in tastes and fashion | A shift to the RIGHT |
A fall in consumer incomeA fall in the price of substitutesA rise in the price of complementsA negative change in tastes and fashion | A shift to the LEFT |

Tastes & Fashions:

Over time these are constantly changing, If something is fashionable then it will be in high demand.

Tastes are more personal; vegetarians would never buy beef of chicken

Total Revenue/Expenditure = Price X Quantity


Supply: The quantity of a product that producers are willing and able to provide at different market prices over a period of time

Economists assume that the motives of a producer are governed by profit

Relationship between Price and Quantity Supplied

Suppliers always want to supply at a high price!
There is a normal positive relationship between the two, if price rises, supply rises

Producer Surplus:

Producer Surplus: The difference between the price a producer is willing to accept and what is actually paid.


Determinants of Supply:

Costs of Production:
These would increase if a company had to pay more for labour or for certain natural resources. Banks cut cost by replacing labour with machines

Size & nature of the industry:
In a competitive industry minor increases in costs can have a big effect on supply. In a more inelastic market, the cost can be passed onto the consumer without it having a great effect.

Government Policy:
VAT for example, this increases the price for the consumer which affects the ability of the producer to supply. Regulations can lead to higher costs of productions but Subsidy’s can lower them

Factors Suppliers cannot control:
Weather! Hugely important in the agricultural industry

Change in Supply Due to: | Effect on Supply Curve |
A fall in raw material costsAn improvement in labour efficiencyA reduction in the rate of indirect taxationA positive technological advanceAny other positive factor | A shift to the RIGHT |
An increase in raw material costsAn increase in labour costsAn increase in the rate of indirect taxationAny other negative factor | A shift to the LEFT |

Equilibrium Price: The price where demand and supply are equal
Disequilibrium Price: Any position in the market where demand and supply aren’t equal
In practice markets are very unstable and operate in disequilibrium, this is when we get excess demand/ supply
Surplus: an excess of supply over demand
For example the supplier feels that their product can be sold at £400 and at this price they will supply 1140 holidays but then consumers only buy 650 of those because the price is high, there is too much SUPPLY therefore the operator has to decrease the price. Sales!!!
When supply is greater than demand price will fall!

Other assignments on As Economics Unit 1 Revision

Organizational Behaviours Essay

1020 words - 5 pages   through  work,  fighting  obsolescence  of  ones  knowledge  and  skills,  maintaining  dignity and purpose in pursuit of organizational goals.  Unit   1: Management Process  This unit deals with management functions which are as follows. Planning, Organizing,   Commanding,  Coordinating , Controlling.  However, in recent time, management   functions have been regrouped into  four categories, since the managerial tasks have become highly

Price Discrimination Essay

4326 words - 18 pages | |Part time: | |Part I |£1075 per Part I subject | | |Band 1 | |£3367 | |Band 2 | |£3867 | |Band 3 | |£4067 | |Part II |£806 per Part II unit

Differentiating Between Market Structures

579 words - 3 pages Differentiating Between Market Structures Nikki Branch ECO212 November 1, 2010 Alex Gialanella Differentiating Between Market Structures When examining market structures a basic knowledge of the types of goods offered is necessary. The four categories of goods are public goods, private goods, common resources, and natural monopolies. Public goods, private goods, and common resources can either be rival or excludable. As consumers in


2343 words - 10 pages | | |5.4 |Review & doubt clearing session (Unit Test 4) | |1 | |THIRD TERM (2 weeks) | | | |6 |ECONOMICS

Eco550 Assignment 1 - Managerial Economics And Globalization

455 words - 2 pages | 4 | 5 | 376 | 94 | 133 | 5 | 5 | 525 | 105 | 149 | 6 | 5 | 684 | 114 | 159 | 6.666 | 5 | 792.59 | 118.90039 | 163.048048 | 7 | 5 | 847 | 121 | 162.9041916 | 8 | 5 | 1008 | 126 | 161 | 9 | 5 | 1161 | 129 | 153 | 10 | 5 | 1300 | 130 | 139 | 11 | 5 | 1419 | 129 | 119 | 12 | 5 | 1512 | 126 | 93 | 13 | 5 | 1573 | 121 | 61 | 14 | 5 | 1596 | 114 | 23 | 15 | 5 | 1575 | 105 | -21 | Reference Farnham, P. G. (2010). Economics for managers (2nded.). Upper Saddle River, NJ: Pearson Education Inc., Published as Prentice Hall

System Administrator

1230 words - 5 pages draft assignment to Blackboard through a link provided in the ‘Assessment’ folder titled ‘Assignment one: Revision 1’. For more information about the submission process or Turnitin, please refer to the detailed submission instructions on Blackboard within the ‘Assessment’ folder. Feedback on assignments The teaching staff is available to assist you with your learning in this unit. You should contact your lecturer in the first instance if you

Term Paper

3672 words - 15 pages cost revision file and the processing options are minimized, as shown in Figure 17. Copyright © 2012 by Klee Associates, Inc. Page 10 Product Costing - Best Practices Figure 17: Processing Options for Writing History Records In the "Enter Date" option, enter a reference date to override the standard "today's date" when cost records must be recorded in an earlier time period. In "Update history records", enter "1" if

Supply Chain Management Term Paper

4874 words - 20 pages be showed as the table below: Target customer | Requirement description | Total quantity | | Product Code | Quantity | | Retail stores | 111,012,122,042,134 | 50×10 | 2500 | Front end manufacturer 1 | 042 | 2500 | 2500 | Front end manufacturer 2 | 114 | 2000 | 2000 | End users | All types | 20 | 800 | Total | | | 7800 | Table 2 Monthly forecast requirements Manufacture requirements Production cycle The firm delivers the

Unit 1 Assignment 1: Effects Of Routing On Current Communication Methods Used By Organizations

3601 words - 15 pages students to retain all handouts and assignment documents issued in every unit, as well as student-prepared documentation and graded deliverables. Some or all these documents will be used repeatedly across different units. Unit 1 Assignment 1: Effects of Routing on Current Communication Methods Used by Organizations Learning Objectives and Outcomes * Explore the effects of routing on current communication methods used by organizations

Inflation Is Key Risk As China Sees Surge In Trade

1268 words - 6 pages Article: inflation is key risk as China sees surge in trade In economics, inflation is a rise in the general level of prices of goods and services in an economy over a period of time. When the general price level rises, each unit of currency buys fewer goods and services. Consequently, inflation also reflects an erosion in the purchasing power of money – a loss of real value in the

Chapter 20 Flash Cards

2250 words - 9 pages (grade point average) and get a 4.0 in your last (marginal) economics class, your GPA will rise. | 20-15. So long as the marginal cost of producing one more unit is less than the previous average cost, average costs must fall. Average total costs must increase whenever marginal costs exceed average costs. | 20-18. Accounting costs refer to the explicit dollar outlays made by a producer. Economic costs, in contrast, refer to the value of

Similar Documents

3ware Cli Ug Essay

6727 words - 27 pages approved hot swap carrier and issue the following command: Example: 3ware CLI> tw_cli maint add c0 p1 cbod Sample of output: Successfully added a CBOD to port troller 0 1 on con- Adding a JBOD drive JBOD units are “just a bunch of disks” and used just like an individual drive. This type of RAID unit is assigned a unit number when added and must be added to the same port the JBOD unit was on before. JBODs can also be configured later as

European Classical Literature Essay

4049 words - 17 pages House tr. Bindu Batra Amitav Ghosh The Shadow Lines 7 Paper 6: English Literature 1 (i) Unit-1. Unit-2. Unit-3. Christopher Marlowe William Shakespeare William Shakespeare Doctor Faustus Othello As You Like It. 8 PAPER 7 CONCURRENT - CREDIT LANGUAGE 9 SEMESTER - III Paper 8: English Literature 1 (ii) Unit-1. Unit-2. Geoffrey Chaucer Philip Sidney Edmund Spenser John Donne Unit-3. ‘The Wife of Bath’s Prologue and Tale’ Selection

Economics Essay

1677 words - 7 pages 1.) Write an essay on the assumption of the “Rational Self Interest”. Make sure that you touch on each of the three components of this assumption that we discussed in class. Comment on the relevance of this assumption in our daily lives. Economics is defined as how we make choices with scarce resources to obtain our own needs, wants and desires. The Assumption of Rational Self –interests tells us that the definition of rationality means not

Personal Development Essay

2636 words - 11 pages months to help you map your career objectives and prepare a personal profile and CV to promote yourself as a newly qualified MBA graduate * Completion of your Portfolio is essential in demonstrating your engagement with the MBA programme. This is an ongoing project, which develops the skills you need to engage with your studies and will be subject to constant revision. You can discuss the activities with your unit tutors at any time during