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1. Mises Academy
Austrian Econ I:
Praxeology Through Price Theory
Robert P. Murphy
Spring 2011
Lecture 4
May 18

2. 2nd
half Chapter 2
1.Schedules Curves
II. Law of Supply/Demand
III. Elasticity
IV. Speculation
V. Total Demand to Hold
VI. Time to Change
VII. Demand vs. Quantity
Demanded
VIII. Producing the Stock
IX. Rothbard on Property

3. I. Supply/Demand Schedule

4. Supply/Demand Curves

5. Generic Supply/Demand Curves

6. II. Laws of Supply/Demand
As price increases, the
quantity supplied will either
increase or stay the same.
As price decreases, the
quantity demanded will either
increase or stay the same.

7. III. Elasticity
● If demand is elastic (in a certain range of prices), then
lowering the price will lead to consumers spending more
total money on the good.
● If demand is inelastic, then lowering the price will lead to
less total money spent on the good.

8. IV. Speculation

9. V. Total Demand to Hold
TOTAL DEMAND TO HOLD =
EXCHANGE DEMAND (I.E. NORMAL
DEMAND) +
RESERVATION DEMAND (I.E.
AMOUNT SELLERS WITHHOLD
FROM THE MARKET)

10. A. Regular Supply/Demand

11. B. Total Stock/Demand to Hold

12. C. Total Stock/Demand to Hold

13. VI. Now It’s Time to Change…

14. VII. Demand vs. Quantity demanded

15. VIII. Producing the Stock

16. IX. Rothbard on Property