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  We call the point where those two curves meet the equilibrium. The point where supply and demand are in agreement is the equilibrium. That is the point at which suppliers are willing to sell roses at the same price consumers are willing to pay for them. So with 600 roses, 600 boxes of roses or whatever it is the equilibrium price is $3.  Well, it's a rose, So with 600 rose the equilibrium rice is $3. That is, both parties are happy in equilibrium. The key point about equilibrium , as the name implies, as the term equilibrium implies, It's the point where the system has come to rest.. Where both parties are happy with the outcome.  Both parties are happy because it's on the demand and supply curve. Since it's on the demand curve, consumers are willing to pay $3 for 600 roses. They wouldn't pay $4 for 600 roses, but they'd pay $3.  Since it's on the supply curve, suppliers are willing to accept $3 for 600 roses. They wouldn't accept $2 for 600 roses, but...

  The next question was what makes them go around?   Or how can we understand this in more detail?  Or is there anything else to say?  In the meantime, Galileo was investigating the laws of motion. Incidentally at the time of Kepler, the problem of what drove the planets around the sun was answered by some people by saying that there were angels behind here, beating their wings and pushing the planet along around the orbit. As we'll see that answer is not very far from the truth the only difference is that the angels sit in a different direction, and their wings go this way.. But the point that the angels sit in a different direction is the one that I must now come to. Galileo in studying the laws of motion and doing a number of experiments such as seeing how balls rolled down incline planets and how pendulums swung. and so on. Discovered an idealization, a great pinciple called the principle of inertia, which is this that if a thing has nothing acting on it, if an o...

I'm an identical twin. And I've always gotten along absolutely perfectly with my twin sister. Her name is Lorna, She lives in france. She's a very fine painter and She shows in Paris and Actually also in China and Japan.   She's a fine painter.  We've never had an argument. And one thing about being an identical twin is everybody asks you about yourself. Everybody does.  Do you have the same cavities in your theeth?  Do you like the same food?  Do you have the same friends?  Everybody does And one time we were maybe around eight or nine. And we were told to assemble in the foier of our house, when one of mother's friends came over. She leaned down to me and she said, asked the standads questions. And then she said,  Do you think alike?  And at the time, I thought to myself as I looked up at her.  Well how would I know how she thinks? I mean that's ridiculous. But I came to realize that there are patterns to personality that are genetical...

  If you want to know if someone really understands evolution, just ask them this one weird question .  Why does poop smell bad?  Oh... Oh, gosh. Because it has bacteria in it, I guess?  Microbiome, probably.  Trash- Yeah, trash from the gut of the body.  The food we eat?  Because of the chemicals?  Farts don't always smell bad.  Yeah. Well, that's a different question entirely.  Do you think it objectively smells bad?  Yes, I think so. Yes.  How do you think it smells to flies?  Like the fly?  Yeah- They like it. They love it.  They like it, yeah. They love it.  Animals love stinky things. Yeah.  They're attracted to it.  Poop smells good to flies because poop is full of nutrients. They use it as food. But it's also full of bacteria that can be life-threatening to humans.  So the real reason poop smells bad to us is because if anyone ever thought it smelled good, they would pro...

  The next question is in going around the ellipse,  How does it go fast when it near the sun and slower when it further from the sun? and so on .  If we take away the other focus we have the sun, and the planet going around.  Kepler found the answer to this, too,  He found this, that if you put this position  of the planet down at two times  separated  by some definite time  let's say three weeks.  A nd then at another place  in the orbit  put the positions of  the planets  again separated by  three weeks. A nd draw lines from the sun to the planet  (technically called radius vector  but anyway lines from the sun to the planet).  Then the area that's  enclosed in the orbit  of the planet and  the two lines  that are separated  by the planets' position  three weeks apart  is the same no matter  what part of the orbit  the thing is on. So that it has to g...

  That basically, at the optimum, the ratio of Marginal Utilities equals the Ratio Prices. That is the rate at which you want to trade off pizza for cookies, is the rate at which the market will allow you to trade off pizza for cookies.  Basically, it's saying the ratio of the benefits.  Think of this as the benefits and this as the costs.  The MRS as the benefits. It's what you want. The  MRT is the costs. It's where you're constrained.  You want to set the ratio of the benefits equal to the ratio of the costs I find it actually easier to think of it this way.  If you just rearrange terms, you can write it as MUc over pc  equals MUp over p sub p.  MUc / Pc = MUp / Pp   I like this way of writing it because I call this  " The bang for the buck equation " What this is saying, your marginal happiness per dollar should be equal. This is sort of the happiness per dollar spent on cookies.  This is the happiness per dollar spent...

  So the demand curve, in this case is represented by the equation Q equals 1,800 minus 400p. Now you're immediately saying well, where's the 1,800, 400 come from?  It doesn't matter right now. That's what I'm going to teach you in the next few lectures. Right now that's an equation that represents a line. And the critical aspect of that equation is that there's a negative relationship between price and quantity. As price goes up, consumers want fewer roses. Why is that? Well, it's just because of opportunity cost. The more expensive is a rose, the more youhave to give up to buy it. So it's opportunity cost is higher, so you want it less. So the higher is the price, the fewer roses you want. So we get a downward sloping demand curve. The blue line. Now the supply curve represents the same relationship between price and quantity but from the supplier's perspective. A supply curve in this case that we've drawn here has the equation q equals 200...