io8 



POLITICAL ECONOMY 



experimentally by observing from year to year variations of 

 quantities bought or quantities supplied at various prices. 



Professor Jevons has since given a much more complex 

 algebraic representation of the same law, which, however, 

 reduces itself to the above simple form. 



The graphic method may also be employed to indicate the 

 advantage gained by each party in trade, and to show how it 

 may be estimated in money. Let the two curves indicate the 

 demand and supply at each price for a certain kind of goods. 

 If all sellers were of one mind, and were willing to supply all 

 their goods at a given price x, and were quite determined to sell 



M 



Fig. 1 



no goods below that price, the supply curve would be a mere 

 straight line parallel to X, and ending abruptly at the ordinate 

 raised at x. Similarly, if all buyers were of one mind, and 

 would only buy below a given price x, but were willing to buy 

 all they want at that price, and no more at any lower price, the 

 demand curve would be a line parallel to X ending abruptly 

 at the ordinate raised at a?, and the price would be quite inde- 

 terminate. If the two lines overlapped, transactions might take 

 place at any price between that at which the sellers were willing 

 to sell and the buyers willing to buy ; there would in this case 

 be no market price. This case does not represent the true state 



