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Worked-example setupScope and assumptions
- The Linden market, participants, equations, and quantities are fictional teaching facts from the linked dataset.
- The product is one new standardized task chair meeting the supplied quality specification, the period is one week, and price is USD per qualifying chair.
- The equations state quantities buyers would purchase and sellers would offer; no order, delivery, transfer of control, invoice, collection, or cost record is supplied.
- Period
- One representative fictional week
- Units
- USD per qualifying chair and qualifying chairs per week
- Rounding
- Exact whole-dollar prices and whole-chair model quantities
Replace “the chair market” with a boundary
The packet concerns new standardized task chairs meeting one quality specification, business buyers and participating sellers in the fictional Linden metro area, and one representative week. Price is USD per qualifying chair; quantity is qualifying chairs per week. The modeled transaction stage is what buyers would purchase and sellers would offer.
The boundary excludes used chairs, custom seating, household buyers, other regions, delivery and credit terms, and transactions outside the week. Those exclusions are not claims that the alternatives never matter. They keep one question coherent.
Label each model quantity
At a $50 price, the supplied baseline equations produce:
- quantity demanded:
1,400 - 10 × $50 = 900 chairs per week; and - quantity supplied:
200 + 10 × $50 = 700 chairs per week.
The first number is not “demand”; it is one quantity demanded on the baseline demand relationship. The second is not inventory or production; it is one quantity supplied on the baseline supply relationship.
Keep the transaction stack open
The 900 and 700 values do not reveal how many orders were accepted, units were delivered, returns occurred, performance obligations were satisfied, invoices were issued, receivables were collected, or costs were recognized. Even the smaller modeled quantity is not automatically recognized revenue.
A controlled memo should carry separate fields for model offers, order records, fulfillment, accounting events, and cash. That separation lets economic analysis inform accounting without overwriting the event evidence.
Verified calculation · economics foundations analysis
The curriculum loader recomputed this example before it entered the site build. Expand any structured input to inspect the stated facts.
- linear markets
- 1 field
Inspect data
{
"linden_baseline": {
"demand_intercept_quantity": 1400,
"demand_quantity_per_price": 10,
"price_checks": {
"reference_price": 50
},
"supply_intercept_quantity": 200,
"supply_quantity_per_price": 10
}
}Recomputed result
| Measure | Value |
|---|---|
| price | 50 |
| quantity demanded | 900 |
| quantity supplied | 700 |