Chapter 4
I found this chapter to particularly interesting, because I immediately made the connection back to the ten principles introduced in Chapter 1. While the sixth principle skimmed the idea that interests controlled the market economy, this chapter fully explained the phenomenon that is Supply and Demand. While I thought that I actually had a good idea of what Supply and Demand was, I found myself learning new concepts and ideals such as supply schedules or inferior goods. I have never taken into account the many external factors that may effect the demand curve, however this chapter expressed these catalyst in a way that was easy to understand.
Question(s):
Can supply and demand really be graphed in such a linear fashion (as shown on pg. 78)? As the price becomes exceedingly expensive I assumed that the demand might drop exponentially, so this surprised.
Is there an industry that can afford to stay at a constant equilibrium quantity (an example)?
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