Presets
Demand Shift
Demand Elasticity
Tax Rate
Equilibrium
Consumer Surplus (CS)
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Producer Surplus (PS)
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Total Surplus
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Deadweight Loss (DWL)
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Equilibrium
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Interactive Microeconomics Supply-Demand Model & Welfare Analysis
The supply-demand model is the core analytical tool of microeconomics. The demand curve slopes downward, reflecting decreased quantity demanded as price rises. The supply curve slopes upward. Their intersection determines market equilibrium.
Curve Shifts: Demand is influenced by income, preferences, and substitute prices. Supply is influenced by technology, costs, and policy.
Consumer surplus is the difference between willingness to pay and actual price. Taxes and price controls create deadweight loss (DWL), reducing market efficiency.
Elasticity measures the sensitivity of quantity to price changes. The less elastic side bears more of the tax burden.