Chapter 4 Demand and Supply Analysis

1
Chapter 4Demand and Supply Analysis
? 2006 Thomson South-Western
2
Exhibit 1 The Demand Schedule and Demand Curve
for Pizza
3
Exhibit 2 An Increase in the Market Demand for
Pizza
15


b
f
12

Price

9
6
D'
3
D
0
8 14 20 26
32

Millions of pizzas per week
4
Exhibit 3 The Supply Schedule and Supply Curve
for Pizza
5
Exhibit 4 An Increase in the Supply of Pizza
S
S'
15.00


g
h
12.00


9.00

Price per quart
6.00

3.00
0
12 16 20 24 28
Millions of pizzas per week
6
Exhibit 5 Equilibrium in the Pizza Market
Market Schedules
7
Exhibit 5 Equilibrium in the Pizza Market
Market Curves
8
Exhibit 6 Effects of an Increase in Demand
S
Price
g
12
c
9

D'

0
20
Millions of pizzas per week
24
30
9
Exhibit 7 Effects of an Increase in Supply
S
S'
Price
c
9
6
d
D
20
26
30
Millions of Pizzas per Week
10
Exhibit 8 Indeterminate Effect of an Increase in
Both Demand and Supply
11
Exhibit 9 Effects of Shifts of Both Demand and
Supply
12
Exhibit 10 NBA Pay Leaps
13
Exhibit 11a Price Floors
S
Surplus
Price per gallon
2.50
1.90
D
0
24
19
14
Millions of gallons per month
14
Exhibit 11a Price Ceilings
S
1000

Monthly rent


600
Shortage
D
0
40
60
50
Thousands of rental units per month