Nonmonotonic Demand and Supply Curves
In the previous chapter, we saw chaos emerge in a model of a consumer’s demand for a good. In this chapter, we model chaos as a result of particular interactions between demand and supply of a good. Before we do this, let us briefly review the workings of a market characterized by demand and supply curves. Let us assume that demand and supply are not instantaneously equated with each other. Rather, adjustments in demand and supply take time.
KeywordsChaotic Behavior Demand Curve Excess Demand Supply Curve Previous Chapter
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