Supply & Demand — a lesson OwlWho built from a lecture
Generated from a 53-minute Introduction to Microeconomics recording. Press play to watch the animated lesson, then make one from your own material.
The big idea
Price is where buyers and sellers stop pulling against each other.
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Narration: Every market is a tug of war between people who want to buy and people who want to sell. Price is where the rope stops moving.
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Market shifts vs. movements
Key concepts from this lecture
TAP A CONCEPT TO JUMPSupply and demand
Buyers want more of something when it is cheap; sellers want to make more of it when it is expensive. Price is where those two pressures meet.
Equilibrium price
The single price where the amount people want to buy exactly equals the amount sellers want to sell.
Market shifts vs. movements
A price change moves you along a curve. A change in anything else — income, tastes, input costs — moves the whole curve.
Surplus and shortage
Above equilibrium, sellers are stuck with unsold goods (surplus). Below it, buyers can't find what they want (shortage). Price drifts back either way.
Scarcity and opportunity cost
Resources are limited, so every choice quietly gives something up. That given-up value is the real cost.