Economics · Markets

Supply & Demand

A neutral market — equilibrium falls where supply meets demand.

Baseline Market

Equilibrium: Q* = 0.0, P* = $0.00
free market
Predict

Tax incidence

Toggle the tax on. Who do you predict bears more of it — buyers or sellers? Check by comparing the price change to the seller's net.

Shift directions

Try this

  • Raise demand intercept by 20 — what happens to Q* and P*?
  • Make supply steeper — how does surplus split shift?
What did you notice?

Reflection