Listening to the professor given an introductory lecture of economy class

In this course, we will look at the basic problems every economy must face: "what" goods shall be produced and "for whom" goods shall be produced. We will look at how a modern mixed economy solves the problems of supply and demand by relying on a system of markets and prices.

Basically, the system goes something like this: consumers are like voters. They use their money votes to buy what they want. Your votes compete with my votes over the goods we both want to buy. The consumers with the most dollar votes have the most influence over "what" gets produced and "to whom" goods go. We will examine how this spending of money votes operates in a market system. In other words, we will examine the theory of supply and demand. We will look at how these two central forces-supply and demand-are brought into balance by the price of goods.

Let's consider demand. It is generally held that the quantity of a particular good that people will buy depends on its price. The higher the price, the less of it people will want to buy. The lower the price, the more people will want to buy. Now, about supply: there is one major factor underlying the supply of a good, and that is the cost of producing that good.

I've just given you the briefest summary of market economics. Tomorrow we will look at just how demand and supply work in the real world and how the market price of a good comes at the point where the amount of a good that consumers wish to buy is equal to the amount sellers wish to sell.