Determinants of SupplyResources Prices -
As price increases, supply decreases. As price decreases, supply increases Technology - As technology increases, supply increases. As technology decreases, supply decreases. Taxes - As taxes increase, supply decreases. As taxes decrease, supply increases Subsidies - As subsidies increase, supply increase. As subsidies decrease, supply decreases. Prices of Other Goods - As the price of A increases, supply of B decreases. As the price of A decreases, supply of B increases. Price Expectations - If the price will increase tomorrow, decrease supply today. If the price will decrease tomorrow, increase supply today. Number of Suppliers - If the number of suppliers increase, supply increases. If the number of suppliers decreases, supply decreases. |
Determinants of DemandConsumer Tastes -
As consumer like a product more, demand increases. As consumers like a product less, demand decreases. Number of Buyer - As number of buyers increases, demand increases. As number of buyers decreases, demand decreases. Income - As income increases, demand for inferior goods decreases and demand for normal or superior goods increases. As income decreases, demand for inferior goods increases and demand for normal and superior good decreases. Price of Related Goods(Substitutes) - As the price of A increases, demand of B increases. As the price of A decreases, demand for B decreases. Price of Related Goods(Complements) - If the price of A increases, demand for B decreases. If the price of A decreases, demand for B increases. Price of Related Goods(Unrelated) - No relationship Exist Consumer Expectations - If price will increase tomorrow, demand increases today. If price will decrease tomorrow, demand will decrease today. |