Analyze market equilibrium, supply curves, and demand dynamics
Supply Curve: Shows the relationship between price and quantity supplied. Generally upward sloping - higher prices incentivize producers to supply more.
Demand Curve: Shows the relationship between price and quantity demanded. Generally downward sloping - higher prices reduce consumer demand.
Market Equilibrium: The point where supply and demand curves intersect, determining the market price and quantity traded.
Consumer Surplus: The area between the demand curve and the equilibrium price, representing consumer benefit.
Producer Surplus: The area between the supply curve and the equilibrium price, representing producer benefit.