The Principles Of Economics By Alfred Marshall Essay

1094 Words Oct 17th, 2014 null Page
Supply and demand is an economic model that works to properly adjust the price of products in order to ensure profitability. Supply and demand change each other based on the needs and/or wants of the consumer(s). Without this vital model, economics itself would be crippled to the point of breakage. The actual existence of supply and demand has been around for longer than most people might think. In fact, the basic concept was written as far back as a fourteenth-century scholar named Ibn Taymiyyah. Taymiyyah wrote “If desire for goods increases while its availability decreases, its price rises. On the other hand, if availability of the good increases and the desire for it decreases, the price comes down. The phrase “supply and demand” however, wasn’t used until 1767 in a book titled “Inquiry into the Principles of Political Economy” by James Denham-Steuart. In 1890, the model was then furthered even more and popularized in the textbook “Principles of Economics” by Alfred Marshall. At a glimpse, the concept of supply and demand may be confusing. This is the opposite of the truth. There are actual laws to this madness that make it logical and easy to understand. It is also represented on a graph called a supply and demand curve. There are four of them. The first states that “if demand increases (demand curve shifts to the right) and supply remains unchanged, a shortage occurs, leading to a higher equilibrium price.” The next says that “if demand decreases (demand curve shifts…

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