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    Managerial Economics: AC 4102 - Group 1

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    Therese Leyva
    Managerial economics studies the integration of economic theory with business practice to facilitate decision-making. The basic factors that affect markets are demand and supply. Demand is influenced by price, income, tastes, related goods' prices, and number of consumers. Supply is influenced by price, costs of production, technology, and availability of factors of production. Market equilibrium occurs when quantity demanded equals quantity supplied at the market-clearing price. Disequilibrium creates surpluses or shortages that drive prices toward the equilibrium level.

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    Managerial Economics: AC 4102 - Group 1

    Uploaded by

    Therese Leyva
    25 views28 pages
    Managerial economics studies the integration of economic theory with business practice to facilitate decision-making. The basic factors that affect markets are demand and supply. Demand is influenced by price, income, tastes, related goods' prices, and number of consumers. Supply is influenced by price, costs of production, technology, and availability of factors of production. Market equilibrium occurs when quantity demanded equals quantity supplied at the market-clearing price. Disequilibrium creates surpluses or shortages that drive prices toward the equilibrium level.

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    Managerial-Economics

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    Managerial economics studies the integration of economic theory with business practice to facilitate decision-making. The basic factors that affect markets are demand and supply. Demand is influenced by price, income, tastes, related goods' prices, and number of consumers. Supply is influenced by price, costs of production, technology, and availability of factors of production. Market equilibrium occurs when quantity demanded equals quantity supplied at the market-clearing price. Disequilibrium creates surpluses or shortages that drive prices toward the equilibrium level.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    25 views28 pages

    Managerial Economics: AC 4102 - Group 1

    Uploaded by

    Therese Leyva
    Managerial economics studies the integration of economic theory with business practice to facilitate decision-making. The basic factors that affect markets are demand and supply. Demand is influenced by price, income, tastes, related goods' prices, and number of consumers. Supply is influenced by price, costs of production, technology, and availability of factors of production. Market equilibrium occurs when quantity demanded equals quantity supplied at the market-clearing price. Disequilibrium creates surpluses or shortages that drive prices toward the equilibrium level.

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    of 28

    Managerial

    Economics
    AC 4102 | Group 1
    03
    demand
    01
    Economics
    Objective 04
    s 02
    Supply
    Managerial
    economics 05
    Market Equilibrium
    Economics
    Production, distribution, and consumption are
    studied in economics and can be divided into two large
    fields of study: macroeconomics and microeconomics. The
    basic factors that affect the market are demand and supply.

    Roland, Jean
    Managerial
    Economics

    Roland, Jean
    “Managerial Economics is the
    integration of economic theory with
    business practice for the purpose of
    facilitating decision-making and
    forward planning for management”

    -Spencer & siegelman

    Roland, Jean
    Demand

    Bag-ao, Dharl Fev


    The law of demand

    The law of demand states that, all


    other factors being equal, when the
    price of a good rises, the amount
    demanded falls, and when the price
    falls, the amount demanded rises.

    Bag-ao, Dharl Fev


    Basis for Demand
    The basis for demand is
    the market demand which
    is the sum of all the
    individual demands

    Bag-ao, Dharl Fev


    Market for demand function
    Demand function shows the relationship
    between quantity demanded for a particular
    commodity and the factors influencing it.

    Bag-ao, Dharl Fev


    dEMAND CURVE
    The demand curve traces the
    quantity of a good or service
    that is demanded at
    successively different prices.

    - downward sloping
    Bag-ao, Dharl Fev
    Factors that affect demand

    Price Consumer’s Price of Related


    Of the product Income Goods

    Tastes and preferences Number of consumers


    of customers in the market
    Bag-ao, Dharl Fev
    Supply

    Suarez, Merrie Suzzane


    The law of Supply

    The law of supply states that, all


    other factors being equal, as the
    price of a good or service increases,
    the quantity of goods or services
    that suppliers offer will increase,
    and vice versa.

    Suarez, Merrie Suzzane


    Basis for Supply
    The amount of product that
    producers bring to the
    market depends on all the
    determinants of supply.

    Suarez, Merrie Suzzane


    Market for supply function
    The market supply function for a product is a
    statement of the relation between the quantity
    supplied and all factors affecting that quantity.

    Suarez, Merrie Suzzane


    Supply CURVE
    Supply curve, in economics, is
    a graphic representation of
    the relationship between
    product price and quantity of
    product that a seller is
    willing and able to supply.

    Suarez, Merrie Suzzane


    Factors that affect Supply

    Price Cost of Technology


    Production

    Availability of Factors
    Weather
    of production
    Suarez, Merrie Suzzane
    Market
    Equilibrium

    Villanueva, Jardine Nicko


    Market equilibrium
    A situation where for a particular good
    supply = demand. When the market is in
    equilibrium, there is no tendency for prices to
    change. We say the market-clearing
    price has been achieved.

    Villanueva, Jardine Nicko


    Whenever markets experience imbalances—
    creating disequilibrium prices, surpluses, and
    shortages—market forces drive prices toward
    equilibrium.

    Disequilibrium

    Villanueva, Jardine Nicko


    Important terms

    01 02
    Surplus Shortage
    exists when the price is above equilibrium, will exist at any price below equilibrium,
    which encourages sellers to lower their which leads to the price of the good
    prices to eliminate the surplus. increasing.

    03 04
    Equilibrium price Equilibrium quantity
    the price in a market at which the quantity the quantity that will be sold and
    demanded and the quantity supplied of a purchased at the equilibrium
    good are equal to one another. price.

    Villanueva, Jardine Nicko


    Changes in the underlying factors
    that affect demand and supply will
    Factors that cause shifts in the position of the
    demand or supply curve at every
    change the price. Whenever this happens, the
    original equilibrium price will no
    market equilibrium longer equate demand with supply,
    and price will adjust to bring about
    a return to equilibrium.

    Villanueva, Jardine Nicko


    Demand shifts
    to the right
    An increase in demand
    shifts the demand curve
    to the right and
    increases price and
    CREDITS: This presentation template was created by
    Slidesgo, including icons by Flaticon, and

    output
    infographics & images by Freepik and illustrations
    by Storyset

    Villanueva, Jardine Nicko


    Demand shifts
    to the left
    A decrease in demand
    shifts the demand curve
    to the left and reduces
    price and output.
    CREDITS: This presentation template was created by
    Slidesgo, including icons by Flaticon, and
    infographics & images by Freepik and illustrations
    by Storyset

    Villanueva, Jardine Nicko


    supply shifts
    to the right
    An increase in supply
    shifts the supply curve
    to the right, which
    reduces price and
    CREDITS: This presentation template was created by
    Slidesgo, including icons by Flaticon, and

    increases output.
    infographics & images by Freepik and illustrations
    by Storyset

    Villanueva, Jardine Nicko


    Supply shifts
    to the left
    A decrease in supply
    shifts the supply curve
    to the left, which raises
    price but reduces
    CREDITS: This presentation template was created by
    Slidesgo, including icons by Flaticon, and

    output.
    infographics & images by Freepik and illustrations
    by Storyset

    Villanueva, Jardine Nicko


    Process of making a Demand and Supply Model

    Villanueva, Jardine Nicko


    THANK YOU FOR
    LISTENING
    CREDITS: This presentation template was created by
    Slidesgo, including icons by Flaticon, and
    infographics & images by Freepik and illustrations
    by Storyset
    Please keep this slide for attribution.

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