1. REVIEW 2.3
Demand

2. DEMAND – the quantity buyers are willing and able to buy at a given price in a given time.
EFFECTIVE DEMAND- For demand to be effective a consumer must be both willing and able to buy the good or service
CONTRACTION OF DEMAND- the fall in the quantity demanded due to a rise in price.
EXTENSION OF DEMAND – the increase in quantity demanded due to a fall in price.

3. A-C = Contraction – Rise in price. A-B = Extension – Fall in price.
EXAM QUESTIONS – 2010 , Q2 (3)

4. INCREASE/DECREASE IN Demand
REVIEW 2.4
INCREASE/DECREASE IN Demand

5. D1 – D3 = INCREASE
D1 – D2= DECREASE

6. Inferior Good – Goods for which the demand falls when income rises.
PASIFIC
Population – Increase in population will cause an increase in demand. Right shift. Also includes the composition (age)
Advertising – Good advertising will cause an increase in demand. Right shift
Substitutes (price of)- If the price of substitutes goes down it’s a fall in demand. Left shift.
Income – If income increases demand increases. Right shift (normal goods) Left shift(inferior goods)
Fashion- In fashion- increase in demand. Right shift
Interest Rates – If interest rates rise then there’s a decrease in demand. Left shift.
Complements- If the price of complements go up, demand goes down. Left shift

7. Past paper questions
Specimen paper – Q8 (8)
2012 – Q1d (8)