# Demand.

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Demand

Demand and Supply Why do roses cost more on Valentine’s Day?
Why do TV ads cost more during the Super Bowl (\$ million for 30 sec.) than during Nick at Nite reruns? Why do hotel rooms in Sun Valley, Idaho cost more in the winter than in the summer? Why do surgeons earn more than butchers? Why do pro basketball players earn more than pro hockey players? Why do economics majors earn more than most other majors? Why are some of you going to major in economics in college? The answer to these and other economics questions boil down to the workings of supply and demand – the subject of this chapter. “Econ, Econ”

Individual Demand Market Demand To “JO” “Mo” “Bo” + = + D D D D2 D 26
1 [Total] \$3 + \$3 + = \$3 \$3 \$2 \$2 \$2 \$2 35 40 26 39 45 30 100 115 115 From “individual” demand to “market” demand And, what if the price of this product decreases from \$3 to \$2? A point to point movement on the same “D” curve is a “Change in QD” And – what if this good prevents cancer, so we have an increase in “D” for it.

QD – how much will be purchased at a specific price [& date].
DEMAND SCHEDULE Consumers “willingness to buy” Price decreases; QD increases D P QD \$5 \$4 \$3 \$2 \$1 \$5 4 3 2 1 10 20 35 55 80 Quantity Demanded …a specified time period …other things being equal QD – how much will be purchased at a specific price [& date].

Law of Demand [Change in QD]
Reasons For Downsloping “D” Curve 1. Income Effect –current buyers buy more. 2. Substitution Effect– new buyers now purchase. 3. Diminishing Marginal Utility - because buyers of successive units receive less marginal utility, they will buy more only when the price is lowered. iPhone [8GB] \$399.00 [with 2 yr contract] Change in QD 1. Price change 2. Movement [up/down the demand curve] 3. Point to point [along the curve] Price QD \$250.00 Inverse relationship QD1 QD2 “D” refers to the “whole curve”. [“all prices”] “QD” refers to a “point on the curve” based on a “particular price.”

Three Reasons Why the Law of Demand Exists
P1 Income Effect When things are expensive, money buys less When things are cheap, money buys more Substitution Effect When apples are expensive and their substitutes (pears) are relatively cheap, I buy fewer apples and more pears Diminishing Marginal Utility Each additional unit of an item purchased gives less marginal utility (happy points) than the previous unit. Therefore, the only way I will buy more is if the price is lower. Ex. When I’m hungry, I typically will buy 2 breakfast tacos. The reason I don’t buy a third taco is because the marginal utility of the third taco is less than the price of the taco. But, if the price of the taco is less than the marginal utility of the taco, then I will buy the third taco P2 QD1 QD1

Demand is a whole bunch of QDs strung together.
Demand [curve] Demand Can Increase or Decrease “Change in Demand (curve)” [“TIMER] 6 5 4 3 2 1 P Demand Schedule D2 D1 Individual Demand D3 P Qd Increase in Demand \$5 4 3 2 1 10 20 35 55 80 Price (per bushel) Decrease in Demand Q Quantity Demanded (bushels per week) Demand is a whole bunch of QDs strung together.

Graphing The Demand Curve [Price Change, Point to Point Movement]
Picture of Law of Demand

Elastic or Inelastic (Total Receipts Test)
\$2 \$1 Elastic Inelastic Total Receipts Test 20 x \$2 = \$40.00 Total Receipts Test 20 x \$2 = \$40 50 x \$1 = \$50 30 x \$1 = \$30.00

Elastic (flexible) Demand Substitutes (butter) Luxury (mink coat)
11. Elasticity of D – the way price affects QD. 12. Elastic - QD that is very responsive to price. 13. Inelastic - a chg in price has little impact on QD. Elastic (flexible) Demand Substitutes (butter) Luxury (mink coat) Expensive (car) Has durability (refrigerator) Lasts a long time (gas-guzzling car) Inelastic (inflexible) Demand No substitutes (milk) Necessity (insulin) Inexpensive (safety pin) No durability (pencil) Lasts only a short time (bread)

Think of “responsiveness” as “flatness”.
Elastic Demand For Cassette Tapes . “TR” Test \$2.50x100,000=\$250,000 \$1.50x600,000=\$900,000 +\$650,000 D -\$1 Think of “responsiveness” as “flatness”.

D “TR” Test \$2 = \$30 bil. \$1 = \$20 bil. -\$10 bil. -\$1 +25% QD

16 oz. Orange juice = 220 calories 16 oz. Tomato juice = 78 calories
Change in “Demand” [curve] [“TIMER”] . Consumers change their minds at each and every price. Based on good or bad publicity about OJ. 16 oz. Orange juice = 220 calories 16 oz. Tomato juice = 78 calories

Quantity Demanded vs. Demand
Quantity Demanded [QD] is triggered by a price chg. The quantities of a good or service that people will purchase at a specific price at a given time. Demand [D] is triggered by “TIMER” [non-price]. A schedule of the total quantities of a good or service that purchasers will buy at different prices at a given time. Demand is a bunch of QD’s strung together.

P D3 D1 D2 P P Bread Butter Bagels D D1 D2 D1 P1 P2
“Demand Shifters” [TIMER] 1. Taste [direct] 2. Income [normal-direct] [inferior-inverse] 3. Market Size [number of consumers-direct] 4. Expectations [of consumers about future *price-direct, about future availability-inverse, or about future income–direct. 5. Related Good *Prices [substitutes-direct] [complements-inverse] D1 D2 D D1 D1 P1 D3 D2 D2 P P2 P P Complement [inverse] QD1 QD2 Substitute [Direct] Bread Butter Bagels Change in “D” [curve] 1. Non price change [“TIMER”] 2. Whole “D” curve shifts [There is a change in “QD” but it is not caused by a change in “price.” [QD-”single price”; D-”all prices”] QD3 QD1 QD2

Change in “Taste” D1 D2 D3 P QD3 QD2
Mini Skirts Hip Huggers Bell Bottoms QD3 QD1 QD2 Platforms 1. An “Increase in Taste” shifts the D curve right a. The Nehru jacket came & went in 6 months. b. Jordache jean demand created by TV c. Leisure suits and bell bottoms. d. Technological change may cause consumer taste to change[slide rules].

1. "Change in Taste" for Dark Chocolate
Increase in demand for dark chocolate after studies revealed that there were health benefits from eating it. Scientists have discovered that smokers who ate dark chocolate had less hardening of the arteries and a lowered risk of blood clots. D2 D1 P

Advertising Can Shift “D” [& also impact QD]
\$45 QD1 QD2

[Normal-Direct; Inferior-Inverse]
2. Change in Income [Normal-Direct; Inferior-Inverse] Spam Steak D2 D1 Less income results in more demand for spam; less demand for steak. More income results in more demand for steak; less demand for spam. P QD1 QD2

Income 2. Change in Income Spam Steak Demand For Demand
Normal Good – goods whose demand varies directly with income. Inferior Good – goods whose demand varies inversely with income. Butter, filet, steel-belts, new clothing & new cars v. Margarine, spam, used tires, old clothing & old cars Demand For Steak Income Demand For Spam

3. Change in Market Size [Direct]
[Number of Consumers] D2 D1 P More demand for both spam and steak. QD1 QD2

3. Market Size (direct) (# of consumers) Increase in # of consumers
can increase/decrease from economic decisions, advertising, and government political decisions (China). Ex: The large “baby boom” of increased the demand for baby supplies. An increase in life expectancy increased demand for for medical care, retirement communities, and nursing homes. Increase in # of consumers

P 4. Expectations [of consumers]
[about future price, availibility, & income] If the iPod-Touch is expected to increase in price from \$299 to \$399. D2 D1 iPod-Touch P QD1 QD2

4. Consumer Expectations
car Consumer expectations about future product price, future availability, & future income. Ex: When the Korean War broke out in the summer of 1950, new car sales boomed (also washers and refrigerators) out of the expectation of a production stoppage like during WWII. None occurred but it was the expectation that affected new car demand.

5. Prices of Related Goods [Substitues-Direct; Complements-Inverse]
QD1 QD2 Substitute [Direct] Gangsta Grills Chrysler 300s Toyotas MV X PQ

5. Prices of Related Goods Cereal & milk Coffee & donuts
There are three types of goods. Independent goods – price change of one has no impact on the other. Ex: fishhooks & pantyhose or salt & shoelaces 2. Substitute goods(“competing goods”) - price change of one affects the demand of the other directly. Ex: 7Up & Coke or Miller & Bud 3. Complementary goods(“go together”) demand for the other inversely. 5. Prices of Related Goods D1 D2 QD2 QD1 Peanut butter & jelly D2 D1 Camera QD1 QD2 Film Cereal & milk Coffee & donuts

[Increase in price of one; increase in “D” of the other]
Substitutes - Direct Demand for Dr Pepper Price Of 7UP D1 D2 D P P2 P1 QD QD QD2 QD1

Complements - Inverse Car Prices Gasoline Demand P D2 D1
[Decrease in price of one; increase in the “D” for the other] Complements - Inverse P1 P2 QD1 QD2 D1 D2 Car Prices P QD QD Gasoline Demand No change in price I’m making more money without dropping my prices. They are so cheap that even dogs are buying cars

[Increase in price of one; increase in “D” of the other]
Substitutes – Direct [Increase in price of one; increase in “D” of the other] Demand for Microsoft’s Zune D2 Price of iPod Video D1 D P P2 P1 QD QD QD2 QD1 1977, Bill was arrested for running a stop sign and driving without a license.

Substitutes - Direct Turkey Chicken
Demand for Turkey Price Of Chicken D1 D2

Prices of Related Goods
Although both monitor & laptop QDs changed, it is still a “Change in D” for those two, because the QD changes were not triggered by a change in price. The price of desktop computers did change so there is a “Change in QD” for desktop computers. D1 D2 D D1 P1 D2 P P2 P Complement [inverse] QD1 QD2 Substitute [Direct] Desktop Computers Monitor Laptops Prices of Related Goods

Substitutes - Direct Windows
Price Of Windows Computers Demand for Apple Computers D1 D2

Substitute/Complement Relationships
. D “Substitutes” D1 D2 P1 P Price Decreases Price Decreases P2 QD2 QD1 QD1 QD2 [DIRECT] Hamburgers Hot Dogs “Complements” D D1 D2 Price Decreases Demand Increases P1 P P2 QD1 QD2 QD1 QD2 [inverse] Syrup Pancakes

“TIMER” P Tastes [direct] Incomes -Normal [direct] & Inferior[inverse]
Market Size(# of consumers) [direct] Expectations of consumers about [future price-direct; future income [direct]; and availability [inverse] Related Good Price Changes [substitutes-direct; complements-inverse] Helmets

Change in QD [“Change in “price”]
Increase in “QD” [caused by a “decrease in price”] Decrease in “QD” [caused by an “increase in price”] D D 1. Price change 2. Movement 3. Point to point [“Snap shot of 1 pt in time] P1 P2 P2 P1 QD1 QD2 QD2 QD1 Change in “D” [“TIMER”] D2 D1 D1 1. Non-price 2. Whole curve 3. Shift [“Time passes”] D2 P P “Increase in D” “Decrease in D” What could cause an “increase in Demand?” Expectations of a shortage 1. Increase in taste Expectations of a price increase 2 .Increase in income [normal good] Expectations of positive future income 3. Decrease in income [inferior good] Incr in price of a substitute for product “X” 4. Increase in market size [# of consumers] Decr in price of a complement of product “X”

[price change/movement/pt to pt] “Shifting the crab demand curve”
Change in D [curve] [non-price change/shift/whole curve] 5 Demand Shifters [“TIMER”] 1. Taste [direct] 2. Income [normal - direct] [inferior - inverse] 3. Market Size [number of consumers - direct] 4. Expectations [price, income, & availability] 5. Related Good Price changes [substitutes - direct] [complements - inverse] Change in QD [price change/movement/pt to pt] D1 D2 D D3 P1 P2 QD3 QD1 QD2 QD1 QD2 [“Moving” along the crab demand curve” because of a crab price change] “Shifting the crab demand curve” +/- QD/D ___ ___ 1. Crab sales are affected by a drop in crab prices. ___ ___ 2. An increase in income causes the demand curve for crab to shift. + QD + D

Graph The Black Boldfaced Items
+/- D/QD Graph The Black Boldfaced Items ___ ___ 1. A population increase affects sales of Pepsi Colas. ___ ___ 2. Consumer incomes in the city of Plano decrease, with the result that jewelry sales are affected. ___ ___ 3. A camera store has a sale that features 25% off the price of all cameras. ___ ___ 4. Texas imposes a 15% luxury tax on the sale of sailboats. ___ ___ 5. A frost in Florida destroys 60% of the orange crop and increases expectations about a future price increase of oranges. ___ ___ 6. Consumers expect the prices of digital cameras to decrease next month. ___ ___ 7. The sale of DVDs is affected by a 20% increase in the price of DVD players. ___ ___ 8. The sale of buns is affected by a 20% decrease in the price of hamburger meat. ___ ___ 9. The sale of Kangaroo meat in Europe [Roo Steak] is affected by a 25% increase in the price of beef. ___ ___ 10. Dunkin Donuts lowers the price of donuts & experiences a change in sales. + D - D + QD - QD + D - D - D D D1 P2 P1 DVD Players [Complements - INVERSE] + D QD2 QD1 DVDs D D1 [Complements - INVERSE] P1 P2 Hamburger meat + Buns D QD1 QD2 D D1 P2 P1 [Substitutes - DIRECT] Beef + QD QD1 Kangaroo meat QD

What is not held constant
Change in QD D Change in QD Price Change Point to Point Movement P1 P2 QD1 QD2 D [INVERSE] P2 P1 What is not held constant in these two graphs? Price QD QD1 “Change in Demand” D1 D1 D2 D2 P P Do not confuse these two with “Chg in QD” Q1 Q2 Q2 Q1 Change in Demand Non-Price Change Whole Curve Shift

[D – “TIMER; QD – price change [inverse]
__1. Which will cause an “Increase in D” for MP3 Player phones? a. increase in income c. increase in the price of MP3 Player phones b. decrease in income d. decrease in the price of MP3 Player phones ___2. Which will cause an “Increase in QD” for MP3 Player phones? a. decrease in income c. decrease in the price of MP3 Player phones b. increase in income d. increase in the price of MP3 Player phones ___3. Which will cause a “Decrease in D” for Projectors? a. increase in the price of projectors c. decrease in # of consumers b. decrease in the price of projectors d. increase in projector taste ___4. Which will cause a “Decrease in QD” for Projectors? a. increase in the price of projectors c. decrease in # of consumers b. decrease in the price of projectors d. increase in projector taste MP3 Player Phone [stereo sound, downloadable sound games and ring tones] A C C A

QD & D Practice Quiz[Snickers]
1. What would cause an “increase in QD” for Snickers? a. increase in price of Snickers b. decrease in price of Snickers c. decrease in income d. increase in number of consumers 2. What would cause an “increase in D” for Snickers? a. increase in taste b. decrease in price of Snickers c. decrease in income d. increase in the price of Snickers 3. What would cause a “decrease in QD” for Snickers? a. increase in taste b. decrease in price of Snickers c. increase in price of Snickers 4. What would cause a “decrease in D” for Snickers? a. decrease in income b. increase in taste c. decrease in price of Snickers 5. An “increase in the price of Butterfingers would cause a(n) (increase/decrease) in (QD/D) for Snickers?

NS 1-10 1. (Demand/Supply) is identified as quantities consumers are willing and able to buy at various prices during a given time period. 2. The law of demand says that price & QD are (directly/inversely) related. 3. The most important variable influencing decisions to produce and purchase goods is (technique/price). (Price/income) is not held constant when moving along a stable demand curve. 4. Income effect-the increase or decrease in purchasing power brought on by a change in (taste/market size/price). 5. Substitution effect – tendency to substitute a (higher/lower) -priced product for a more expensive product. 6. Diminishing marginal utility – utility, or (determination/anger/satisfation) decreases as more of the same product [Snickers] is consumed. 7. The law of demand refers to a (movement/shift) along a demand curve. 8. Substituting chicken as the price of steak goes up is an example of the (income/substitution) effect. 9. When the price of caviar falls, the purchasing power of our money income rises & thus permits us to purchase more caviar. This is the (income/substitution) effect. 10. The demand (curve/schedule) is a numerical tabulation showing QD at each price. The demand (curve/schedule) is a graphical representation of the law of demand.

NS 11. Elasticity of demand–the way price affects (attitude/quantity/market size). 12. (Inelastic/Elastic) demand – demand that is very responsive to price. [A small price increase causes a large decrease in quantity demanded.] 13. (Inelastic/Elastic) demand-when a change in price has little impact on QD. 14. The 3-item test for elastic demand are substitutes, luxury items, and (inexpensive/expensive) items. 15. The 3-item test for inelastic demand are no substitutes, necessities, and (inexpensive/expensive) items. 16. Expensive cars have (inelastic/elastic) demand. 17. Pepsi Cola has (inelastic/elastic) demand. 18. Insulin has (inelastic/elastic) demand. 19. The elastic demand curve is more (horizontal/vertical). [much change] 20. The inelastic demand curve is more (horizontal/vertical). [not much change]

NS 21-26 21. With the invention of the calculator, the demand curve for the slide rule (increased/decreased). 22. When Forest Gump went to China & the U.S. followed by opening up relations with China, the demand curve for Coke (increased/decreased). 23. An increase in income would (increase/decrease) the demand for used clothing. [inferior good] 24. A decrease in income would (increase/decrease) the demand for lobster. [normal good] 25. A decrease in the price of product X [lumber] will (incr/decr) the demand for the complementary product Y. [nails] 26. After Brooke Shields[15] did her national TV ads[“Nothing comes between me and my Calvin’s”], the “D” curve moved (right/left). \$45

NS 27-38 27. An increase in the price of Pepsi causes the
demand curve for Coke to move to the (right/left). 28. If there is a sale on shirts, the demand curve for ties will move to the (right/left). 29. If a man’s workplace is about to close down, his demand curve for major purchases would move to the (right/left). 30. If a cure for lung cancer were found, the demand curve for cigarettes would move to the (right/left). 31. If the price of pancakes decreases, the demand for syrup, a complement, will (increase/decrease). 32. If the price of butter decreases, the demand for margarine will (incr/decr). 33. A “change in QD” is caused by (price change/TIMER) [a “movement”] 34. A “change in D” is caused by (price change/TIMER) [a “shift”] e

“Econ, Econ”. Let tell you about econ. The End

1.–QD 2. –D 3. +D 4.+D 5.+D 6.+D 7.–QD 8.–QD 9.+D 10.+D
1. Madonna gave a concert at the AAC after doubling the ticket price and experiencing a change in anticipated attendance. 2. A decrease in taste causes the demand for lobster to shift. 3. A 20% increase in the price of Pepsi affect the sale of Coke. 4. Consumers expect the price of cell phones to increase 25% next month. 5. The sale of Ford F150s is affected when the U.S. begins trading with Cuba. 6. New autos decrease in price by 20% & the sale of gasoline is affected. 7. Victoria’s Secret increases the price of its thongs by 40% and experiences a change in the volume of sales. 8. Britney Spears triples the price of her album, “Oops, I flunked Econ Again,” and sales are affected. 9. A drought in Texas destroys 40% of the state’s peaches & increases consumer expectations about a future price increase of peaches. 10. A 15% decrease in the price of motorcycles affect the sale of helmets. Taste [direct] Income [normal-direct] [inferior-inverse] Market Size [# of consumers-direct] Expectations [price-direct] [income-direct] [availability-inverse] Related Good Price Changes [subs-direct] [complements-inverse] 1.–QD –D D D D 6.+D –QD 8.–QD 9.+D D

1.+QD 2.+D 3. -D 4.-D 5. -D 6.+D 7.+QD 8.+QD 9.+D 10.+D
1. Christina gave a concert at the AAC after lowering the ticket price and experiencing a change in anticipated attendance. 2. An increase in taste causes the demand curve for lobster to shift. 3. The sale of coke is affected by a 20% decrease in the price of Pepsi. 4. Consumers expect the price of XBOX to decrease 25% next month. 5. The sale of Dr Pepper is affected when the U.S. goes to war with China. 6. New SUVs decrease in price by 30% & the sale of gasoline is affected. 7. Victoria’s Secret decreases the price of its teddies by 50% and experiences a change in the volume of sales. 8. The Spice Girls lower the price of their album, “Oops, We Actually Passed Econ,” and sales are affected. 9. A freeze in California destroys 70% of the state’s oranges and increases consumer expectations about a future price increase of oranges. 10. A 50% increase in the price of bread affect the sale of bagels. Taste [direct] Income [normal-direct] [inferior-inverse] Market Size [# of consumers-direct] Expectations [price-direct] [income-direct] [availability-inverse] Related Good Price Changes[subs-direct] [complements-inverse] 1.+QD D D D D 6.+D QD 8.+QD 9.+D D

Review of Demand

Law of Demand [Change in QD]
Reasons For Downsloping “D” Curve 1. Income Effect –current buyers buy more. 2. Substitution Effect– new buyers now purchase. 3. Diminishing Marginal Utility - because buyers of successive units receive less marginal utility, they will buy more only when the price is lowered. iPhone [8GB] \$399.00 [with 2 yr contract] Change in QD 1. Price change 2. Movement [up/down the demand curve] 3. Point to point [along the curve] Price QD \$250.00 Inverse relationship QD1 QD2 “D” refers to the “whole curve”. [“all prices”] “QD” refers to a “point on the curve” based on a “particular price.”

P D1 D3 D3 P P Games for PS3 PS3 XBOX D D1 D2 D1 P1 P2
“Demand Shifters” [“TIMER”] 1. Taste [direct] 2. Income [normal-direct] [inferior-inverse] 3. Market Size [number of consumers-direct] 4. Expectations [of consumers about future price-direct, about future availability-inverse, or about future income–direct. 5. Related Good Prices [substitutes-direct] [complements-inverse] D1 D2 D D1 D1 D3 P1 D3 D2 P P2 P P Complement [inverse] QD1 QD2 Substitute [Direct] Games for PS3 PS3 XBOX Changes in “D” [curve] 1. Non price change [“TIMER”] 2. Whole “D” curve shifts [There is a change in “QD” but it is not caused by a change in “price.” [QD-“singe price”; D-”all prices”] QD3 QD1 QD2

D2 P 1."Change in Taste" [Direct] QD3 QD1 QD2 A decrease in taste
for videos results in a decrease in demand. An increase in taste for DVDs results in an increase in demand. D2 D1 D3 P QD3 QD1 QD2

[Normal-Direct; Inferior-Inverse]
2. Change in Income [Normal-Direct; Inferior-Inverse] Used Cars New Cars D2 D1 Less income results in more demand for used cars; less demand for new cars. More income results in more demand for new cars; less demand for used cars. P QD1 QD2

3. Change in Market Size [Direct]
[Number of Consumers] This is what we told one billion Chinese, as new potential consumers, when we opened trade relations with them in 1972. D2 D1 P New Cars More demand for both normal & inferior goods QD1 QD2 Used Cars

P 4. Expectations [of consumers]
[about future price, availibility, & income] If Steve Jobs responds to iRate customers who bought the iPhone at \$599 and says, “iSorry, we will raise the price back to \$599 in 3 weeks.” \$399 D2 D1 Buy it now to save money. iPhone P QD1 QD2

4. Expectations [of consumers]
[about future income] Let’s say that we are coming out of recession & consumers feel secure about their jobs. [Positive future income] D2 D1 P QD1 QD2

4. Expectations [of consumers]
[about future income] Let’s say that we are going into a recession and consumers don’t feel secure about their jobs. [Negative future income] D1 D2 P QD2 QD1

5. Prices of Related Goods [Substitutes-Direct; Complements-Inverse]
QD1 QD2 Substitute [Direct] Cereal Milk Pop Tarts

Substitutes - Direct Complements - Inverse Dr Pepper Coke Motorcycles
QD1 QD2 Helmets Complements - Inverse

What is not held constant
Change in QD D Change in QD Price Change Point to Point Movement P1 P2 QD1 QD2 D [INVERSE] P2 P1 What is not held constant in these two graphs? Price QD QD1 “Change in Demand” D1 D1 D2 D2 P P Do not confuse these two with “Chg in QD” Q1 Q2 Q2 Q1 Change in Demand Non-Price Change Whole Curve Shift

[D – “TIMER; QD – price change [inverse] [Revised from previous]
__1. Which of the following will cause an “Decrease in D” for iPod nanos? a. increase in income c. increase in the price of iPod nanos b. decrease in income d. decrease in the price of iPod nanos ___2. Which will cause an “Decrease in QD” for iPod nanos? a. decrease in income c. decrease in the price of iPod nanos b. increase in income d. increase in the price of iPod nanos ___3. Which of the following will cause a “Increase in D” for HDTVs? a. increase in the price of HDTVs c. decrease in # of consumers b. decrease in the price of HDTVs d. increase in HDTV taste ___4. Which of the following will cause a “Increase in QD” for HDTVs? a. increase in the price of HDTVs c. decrease in # of consumers b. decrease in the price of HDTVs d. increase in IPOD taste B D D B

QD & D Practice Quiz [“Revised”]
1. What would cause a “decrease in QD” for KitKats? a. increase in price of KitKats b. decrease in price of KitKats c. decrease in income d. increase in number of consumers 2. What would cause a “decrease in D” for KitKats? a. increase in taste b. decrease in price of Kitkats c. decrease in income d. increase in the price of KitKats 3. What would cause an “increase in QD” for KitKats? a. increase in taste b. decrease in price of KitKats c. increase in price of KitKats 4. What would cause an “increase in D” for KitKats? a. increase in # of consumers b. decrease in taste b. decrease in price of KitKats 5. A “decrease in the price of Reese’s would cause a(n) (increase/decrease) in (QD/D) for KitKats?

Elastic/Inelastic Demand
. Go over Total Receipts Test For Elastic & Inelastic

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