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Ever wondered why demand and supply are so important? Wonder no more …
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on Friday, February 3rd, 2012 at 12:36 pm and is filed under Fun, Microeconomics, Rock'n'Roll.
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lol! The presentation looks funny but holds truth about the characteristic of demand and supply.
Oh okay thank you. Then supply will be a schedule showing the amounts of a good or services that sellers will offer at various prices during some period?
Yes that is correct. The supply curve is an illustration of the supply at each given price and quantity.
How will an increase in food prices effect the demand and supply curves?
An increase in food prices will decrease the demand curve, because consumers will purchase less. An arise in food prices will increase the supply curve because producers will produce more because they earn more with the increase in prices.
Inflation causes demand to decrease because if your income stays the same and prices increase you are forced to buy less with the same income due to the higher prices
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