Plain Sense Economics

In the discussion of demand and supply we noted that demand for a product is chiefly determined by its price. For almost all products the demand curve slopes down and to the right – with a negative slope. The shape of the typical demand curve tells us that demand is inversely related to changes in [...]

Today we spend some time on demand and supply – topics relevant to students taking either microeconomics or macroeconomics. Adam Smith, who lived in Great Britain in the late 1700s, helped us understand how marvelous market actions can be. We bring together buyers (those who determine the shape and position of the demand curve) with [...]

Classical economics is based on the idea that individuals and societies need certain important resources in order to thrive. Inevitably those important resources are scarce – there are not enough of them to meet everyone’s needs or wants. Much of economics is based on the question of how we go about allocating those scarce resources.
Let’s [...]