Seller or buyer, depends on which side is less elastic
How does a tax on the buyers affect the equilibirum price?
The demand curve shifts left. Sellers recieve less money and sell less.
How does the nº of producers (5) affect the supply curve?
If the number of producers increase the curve shifts right, same price more production (Q)
If it decreases the curve shifts left, same price less production
What is a complement?
E(pr)<0 <=> Pr^=> Qr v => Q v
What is a substitute?
E(pr)>0 <=> Pr^ => Qr v => Q ^
How does the price (1) affect the demand curve?
The price does not affect in the curve, it just moves along the slope. Higher price=lower demand and viceversa
How does the income (3) affect the demand curve?
An increase of income shifts the curve to the right, same price more buyers. A decrease of income shifts the curve left, same price less buyers
What is a normal good?
Using Income Elasticity of demand, when E(m)>0 <=> m^=> Qd ^
