3 ms·
This is exactly how a price shift in the supply demand curve works in basic macroeconomics. If you price shift a good upwards and the demand remains static, yi
by viridian 4y ago
This is exactly how a price shift in the supply demand curve works in basic macroeconomics.
If you price shift a good upwards and the demand remains static, yield per good increases and then supply should increase as suppliers willing to supply at the new price is greater than supplier willing to supply at the old price.
- bottled_poe 4y ago> demand remains static, How can this be an assumption? Of course demand will respond to price.
- viridian 4y agoDemand is a slope, not a point. Price increases left shift demand, prices decreases right shift demand. This is because more people are willing to buy a good at a cheaper price than a more expensive one. In this context demand is the total desire of the market to consume that good at all, represented by a slope that has an inverse relationship with the price axis.