Interactive board · microeconomics · free access
Supply, demand, and elasticity in real time
Pick a scenario or stack up your own forces: income, the price of a substitute, input costs, technology. Each force shifts its curve according to the elasticity you set, and the equilibrium moves instantly.
Reading the board
Nothing has moved yet. The market is at its starting point: a price of $10.00 and a quantity of 100 units. Pick a scenario on the right or add a force.
Model
The shape of the curves decides whether elasticity is the same at every point or changes along the curve.
Forces
Each force has a size (how much it changed) and an elasticity (how strongly the curve responds).
Scenarios
Each one sets up its own forces, with an animation and an explanation.
The four elasticities on the board
How much quantity demanded falls when the price rises 1%. ε > 1 is elastic (there are substitutes, the purchase can wait); ε < 1 is inelastic (a necessity, no alternative). It decides whether a shock turns into a price change or a quantity change.
How much output responds to a 1% rise in price. It depends above all on the time horizon: installed capacity is fixed today and flexible over a few years. Inelastic supply pushes the whole shock into the price.
How demand responds to 1% more income. Positive: normal good; above 1, a luxury (or superior) good. Negative: inferior good — demand rises when income falls.
How demand for X responds to a 1% rise in the price of Y. Positive: substitutes (coffee and tea). Negative: complements (cars and gasoline). Near zero: unrelated goods.
| If you change… | What shifts | Equilibrium price | Equilibrium quantity |
|---|---|---|---|
| Income, tastes, price of a related good | Demand | Moves in the same direction | Moves in the same direction |
| Input costs, technology, number of sellers | Supply | Moves in the opposite direction | Moves in the same direction |
| Expected future price rise | Both | Rises sharply | Ambiguous: depends on which force is stronger |
| Only the good’s own price | Neither | A movement along the curve, not a shift of the curve | |
The model is deliberately simple: it is meant to teach the mechanism, not to forecast real prices. The curves come from two classic families: the straight line (Q = a − bP), where elasticity changes from point to point, and constant elasticity (Q = A·P−ε), where it is the same along the entire curve. Forces enter as proportional shifts, (1 + change)elasticity, which is exact for the constant-elasticity form and a good approximation for the straight line. There are no taxes, market power, inventories, or dynamics across periods — for taxes, subsidies, price ceilings, and price floors, use the intervention lab (in Portuguese). With constant elasticity and ε ≤ 1, consumer surplus is not finite, so the shaded areas are always measured within the visible range of the graph. The guide (in Portuguese) walks through every formula, every scenario, and the classic exam traps.