The Demand Curve (Table)

• The quantity demanded is a declining function of the price, as the table illustrates.

Increase in Demand

• When demand increases, the quantity demanded is greater at every price.

Decrease in Demand

• When demand decreases, the quantity demanded is lower at every price.

The Demand Curve (Graph)

• The same demand curve can be represented by a simple graph with a negative slope.
• At price = 25, the quantity demanded = 15.

Change in the Quantity Demanded

• A change in the quantity demanded is a movement along the demand curve.
• At price = 10, the quantity demanded = 30.

Increase in Demand

• An increase in demand is a rightward shift in the entire curve.
• More is demanded at every price
• At price = 25, the quantity demanded = 25 after the increase.

Decrease in Demand

• A decrease in demand is a leftward shift in the entire curve.
• Less is demanded at every price
• At price = 25, the quantity demanded = 10 after the decrease.

The Demand Curve (Equation)

• Mathematically, the demand curve is an equation that shows a negative relation between price (P) and quantity (Q) for all positive prices and quantities.

Increase in Demand

• The demand equation now indicates that the quantity demanded is greater at all prices.

Decrease in Demand

• The demand equation now indicates that the quantity demanded is lower at all prices.

The Supply Curve (Table)

• The quantity supplied is an increasing function of the price, as the table to the right illustrates.

Increase in Supply

• When supply increases, the quantity supplied is greater at every price.

Decrease in Supply

• When supply decreases, the quantity supplied is lower at every price.

The Supply Curve (Graph)

• The same supply curve can be represented by a simple graph with a positive slope.
• At price = 25, the quantity supplied = 31.

Change in the Quantity Supplied

• A change in the quantity supplied is a movement along the supply curve.
• At price = 10, the quantity supplied = 16.

Increase in Supply

• An increase in supply is a rightward shift in the entire curve.
• More is supplied at every price
• At price = 25, the quantity supplied = 36 after the increase.

Decrease in Supply

• A decrease in supply is a leftward shift in the entire curve.
• Less is supplied at every price
• At price = 25, the quantity supplied = 21 after the decrease.

The Supply Curve (Equation)

• Mathematically, the supply curve is an equation that shows a positive relation between price (P) and quantity (Q) for all positive prices and quantities.

Increase in Supply

• The supply equation now indicates that the quantity supplied is greater at all prices.

• The supply equation now indicates that the quantity supplied is lower at all prices.

Market Equilibrium (Table)

• At a price of 17, the quantity demanded is equal to the quantity supplied, as the table to the right illustrates.

Market Equilibrium (Graph)

• The market equilibrium occurs at the intersection of the supply and demand curves.
• At price = 17, the quantity supplied = quantity demanded = 23.

Market Equilibrium (Equations)

• The equilibrium price and quantity satisfy both the demand and supply equations simultaneously.