demand
DESCRIPTION
DEMAND. DEMAND. The desire , ability , and willingness to buy a product. Law of Demand. Price and demand are inverse. As price goes up = demand goes down As price goes down = demand goes up. DEMAND SCHEDULE. A listing that shows corresponding prices and quantities demanded. - PowerPoint PPT PresentationTRANSCRIPT
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DEMAND
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DEMAND The desire, ability, and willingness to
buy a product.
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Law of Demand Price and demand are inverse. As price goes up = demand goes
down As price goes down = demand goes
up
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DEMAND SCHEDULE A listing that shows corresponding
prices and quantities demanded.
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Mr. Lawson’s Demand Schedule for a Blu-Ray
PRICE QUANTITY DEMANDED
$50$40$30$20$10$5
001123
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DEMAND CURVE Demand schedule in graph form
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Mr. Lawson’s Demand Curve for a Blu-Ray
$50
$40
$30
$20
$10
$5
$0 0 1 2 3
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Changes in Demand Causes demand curve to SHIFT to the
right or left.
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Change in Demand$50
$40
$30
$20
$10
$5
$0 0 1 2 3
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Causes for Change in Demand?
Consumer Income Consumer Taste Substitutes Complements Change in Expectations Number of Consumers
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Consumer Income If consumer’s incomes increase they
are able and willing to buy more products
If consumer’s incomes decrease they are less likely to buy products.
Ex.: When our unemployment rate is low, our economy strives.
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Consumer Tastes Advertising, news reports, fashion
trends, and changes in the season have an affect on demand
Ex: In the month of October, people tend to buy items that are pink…
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Substitutes Products that can be used in place of
other products.
Ex.: when the price of Coca-Cola goes up, the demand for Pepsi goes up.
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Complements An item that increases the use of
another product.
Ex.: When the price of blu-ray players goes down, consumers buy more blu-ray players and blu-rays.
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Change in Expectation Change in what people expect
in the future.
Ex.: the iPhone 5 was announced in June. That caused the demand for iPhone 4/4s to go down.
Ex.: consumers might wait until Black Friday to buy a product they know will be on sale.
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Number of Consumers An increase in the number of
consumers will change the demand for an item.