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We construct market demand curves for products by horizontally summing quantities demanded of a good by each person in the market. So, if there are two people in the market for good $X$, at a certain price, $P^{*}_{X}$, individual 1 will demand $X^{*}_{1}$ and individual 2 will demand $X^{*}_{2}$. We add up $X^{*}_{1}+X^{*}_{2}$, and this gives us the total quantity demanded at the market at $P^{*}_{X}$

Market demands will be represented by capital letters from now on, and individual demands by lower case letters.

This lecture introduces the concept of elasticity.

### One Response to “EC4004, Ecs for Business, Lecture 4: Market Demand and Elasticity”

1. Laura

You're definitely my favourite lecturer so far! Even went into your lecture hungover and wrecked but still didn't fall asleep in it... If only they were all made as interesting as yours 🙂