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The '''''supply''''' of a good is how much of it (the quantity), and at what price, is provided by a seller of the good.  Grocery stores, factories, malls, amazon.com, and candy stores all '''''supply''''' goods.  Services, like entertainment, are supplied by Hollywood, Major League Baseball, the NFL and also doctors, lawyers, accountants, and so on.  The supply side consists of the producers, providers and sellers of goods and services.

The '''''supply''''' of a good is how much of it (the quantity), and at what price, is provided by a seller of the good.  Grocery stores, factories, malls, amazon.com, and candy stores all '''''supply''''' goods.  Services, like entertainment, are supplied by Hollywood, Major League Baseball, the NFL and also doctors, lawyers, accountants, and so on.  The supply side consists of the producers, providers and sellers of goods and services.

The '''''demand''''' for a good is how much of it, and at what price, is wanted by the public seeking to buy it.  Shoppers, moviegoers, baseball and football fans, and people needing medical care are, on the demand side.  Often buyers of goods and services are called "consumers".

The '''''demand''''' for a good is how much of it, and at what price, is wanted by the public seeking to buy it.  Shoppers, moviegoers, baseball and football fans, and people needing medical care, are on the demand side.  Often buyers of goods and services are called "consumers".

For any given good or service, there is a supply and demand.  The supply can be described in terms of the possible production of different quantities at different prices.  The demand can be described separately as the willingness of the public to purchase different quantities at different prices.  The price is the key to both the supply and demand side; it is the price that determines the quantity transacted.

For any given good or service, there is a supply and demand.  The supply can be described in terms of the possible production of different quantities at different prices.  The demand can be described separately as the willingness of the public to purchase different quantities at different prices.  The price is the key to both the supply and demand side; it is the price that determines the quantity transacted.

Demand by the public in England was high for this Bible, but the supply was low due to limitations of the printing press and the opposition by the authorities.  High demand and low supply cause this:  a high price.  The King and church authorities began buying up copies of this Bible in Europe to keep it out of the hands of the public, but often had to pay the "market price" to buy up the copies.  This money then went to the printers and provided the funds for them to pay for the printing of more Tyndale Bibles, and 15,000 copies were printed between 1525 and 1530.  This effect of supply and demand made it difficult -- perhaps impossible -- to censor and suppress this English Bible.

Demand by the public in England was high for this Bible, but the supply was low due to limitations of the printing press and the opposition by the authorities.  High demand and low supply cause this:  a high price.  The King and church authorities began buying up copies of this Bible in Europe to keep it out of the hands of the public, but often had to pay the "market price" to buy up the copies.  This money then went to the printers and provided the funds for them to pay for the printing of more Tyndale Bibles, and 15,000 copies were printed between 1525 and 1530.  This effect of supply and demand made it difficult -- perhaps impossible -- to censor and suppress this English Bible.

Supply and demand comprise a very powerful force, stronger than any individual or government.  Over time, supply and demand prevail, and ultimately the authorities approved an English translation of the Bible, leading to the printing of the magnificent King James Version (which was very similar to the Tyndale Bible) less than a century later, in 1611.  But the unstoppable effect of supply and demand did not occur soon enough to help Tyndale himself.  He kept improving his translation of the New Testament (his final version was completed in 1635) and also worked on completing his own translation of the Old Testament.  But he was captured in what is now Belgium before he could translate all of the Old Testament.  His last words were "Lord, open the king of England's eyes" just prior to his execution as a heretic in 1536. His assistant, Miles Coverdale, finished Tyndale's translation of the Old Testament and published the complete English Bible in 1537.  The King then approved it.

Supply and demand comprise a very powerful force, stronger than any individual or government.  Over time, supply and demand prevail, and ultimately the authorities approved an English translation of the Bible, leading to the printing of the magnificent King James Version (which was very similar to the Tyndale Bible) less than a century later, in 1611.  But the unstoppable effect of supply and demand did not occur soon enough to help Tyndale himself.  He kept improving his translation of the New Testament (his final version was completed in 1635) and also worked on completing his own translation of the Old Testament.  But he was captured in what is now Belgium before he could translate all of the Old Testament.  His last words just prior to his execution as a heretic in 1536 were these: "Lord, open the king of England's eyes."  His assistant, Miles Coverdale, finished Tyndale's translation of the Old Testament and published the complete English Bible in 1537.  The King then approved it.

But years ''after'' King Henry VIII split from Rome and founded the Church of England, the English Parliament passed a law in 1543 that censored English Bibles again, prohibited unlicensed reading of Scriptures in public, and caused English Bibles to be burned in London and translators to be arrested (one translator was executed, but Coverdale fled to Geneva, where John Calvin was).  The free market had more work to do before it prevailed.

But years ''after'' King Henry VIII split from Rome and founded the Church of England, the English Parliament passed a law in 1543 that censored English Bibles again, prohibited unlicensed reading of Scriptures in public, and caused English Bibles to be burned in London and translators to be arrested (one translator was executed, but Coverdale fled to Geneva, where John Calvin was).  The free market had more work to do before it prevailed.

“Equilibrium” is “where things are going” or where they have already arrived.  Economic equilibrium is when all the imbalances in the forces of selling and buying have disappeared and a perfect balance between the sellers' desire to make more money (that's like hunger) and the buyers' desire to pay as little as possible (that's like not eating).  When the market has reached a balance between these two powerful, opposing forces, then it is equilibrium.  The opposing forces of the sellers trying to make money and the buyers trying to keep money are what "drive" the price to its equilibrium level, like a tug of war.   

“Equilibrium” is “where things are going” or where they have already arrived.  Economic equilibrium is when all the imbalances in the forces of selling and buying have disappeared and a perfect balance between the sellers' desire to make more money (that's like hunger) and the buyers' desire to pay as little as possible (that's like not eating).  When the market has reached a balance between these two powerful, opposing forces, then it is equilibrium.  The opposing forces of the sellers trying to make money and the buyers trying to keep money are what "drive" the price to its equilibrium level, like a tug of war.   

When there is perfect competition, then the ultimate equilibrium is when the marginal revenue to the seller (the extra dollar that he charges and receives as revenue) equals his marginal cost in producing the good (the extra dollar he paid to produce the good).  At that point the seller's marginal profit (the extra dollar that he can keep after paying his costs) has fallen to zero and he has no incentive to produce any more goods.  In other words, the supplier keeps producing more and more goods only until his marginal profit on each extra good falls to zero, and he does not make any more money by selling additional quantity.   

When there is perfect competition, then the ultimate equilibrium is when the marginal revenue to the seller (the extra dollar that he charges and receives as revenue) equals his marginal cost in producing the good (the extra dollar he paid to produce the good).  At that point the seller's marginal profit (the extra dollar that he can keep after paying his costs) has fallen to zero and he has no incentive to produce any more goods.  In other words, the supplier keeps producing more and more goods only until his marginal profit on each extra good falls to zero such that he does not make any more money by selling additional quantity.   

That decline of marginal profit towards zero is due to the inevitable difficulties in selling additional goods.  For example, the first SUV produced by Ford could sell at a high price, but Ford does not want to get stuck with making too many SUVs and not being able to sell them at a profit.  Ford doesn’t want to make any more SUVs in a given year that it might have to take a loss on.  Ford keeps producing SUVs only until its marginal revenue falls to its marginal cost, and its marginal profit falls to zero.  Do not worry if you do not completely understand these last two paragraphs; we'll discuss this again in greater detail in a future lecture.

That decline of marginal profit towards zero is due to the inevitable difficulties in selling additional goods.  For example, the first SUV produced by Ford could sell at a high price, but Ford does not want to get stuck with making too many SUVs and not being able to sell them at a profit.  Ford doesn’t want to make any more SUVs in a given year that it might have to take a loss on.  Ford keeps producing SUVs only until its marginal revenue falls to its marginal cost, and its marginal profit falls to zero.  Do not worry if you do not completely understand these last two paragraphs; we'll discuss this again in greater detail in a future lecture.