#AP Microeconomics: Supply and Demand - Your Ultimate Review 🚀

Hey there, future AP Micro master! Let's dive into the heart of microeconomics: Supply and Demand. This is the foundation for everything, so let's make sure you're rock-solid on these concepts. Think of this as your final prep session before the big game! 🏈

#Unit 2: Supply and Demand - The Core Concepts

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• Demand: Represents consumers' desire and ability to purchase goods/services.
• Supply: Represents producers' willingness and ability to offer goods/services.
• Equilibrium: The point where supply and demand intersect, determining market price and quantity.

#Determinants of Demand: TBPIE

# T - Tastes of Consumers 😋

• Changes in consumer preferences directly shift demand.
• Example: A new health study praising avocados increases demand for avocados.
• Key Point: Advertising, trends, and health information all play a role.

# B - Buyers (Number) 🧑‍🤝‍🧑

• More buyers = higher demand; fewer buyers = lower demand.
• Example: A population boom in a city increases the demand for housing.

# P - Price of Related Goods 👯

• Substitutes: Goods used in place of each other.
  • If the price of a substitute falls, demand for the original good decreases.
  • Example: If the price of coffee decreases, demand for tea might fall.
• Complements: Goods used together.
  • If the price of a complement falls, demand for the original good increases.
  • Example: If the price of peanut butter falls, demand for jelly might rise.

# I - Income 💰

• Normal Goods: Demand increases as income rises.
  • Example: Organic food, designer clothing.
• Inferior Goods: Demand decreases as income rises.
  • Example: Instant noodles, used clothing.

# E - Expectations of Future Prices 🔮

• If consumers expect prices to rise, current demand inc...