Several determinants of demand besides price
Illustrate the several determinants of demand besides price which affect demand?
Expert
Changes in determinants cause changes in demand. There are several determinants of demand besides price which affect demand are:-
a. Tastes—-favorable change leads to increase in demand; unfavorable change to decrease.
b. Number of buyers—the more buyers lead to an increase in demand; fewer buyers lead to decrease.
c. Income—more leads to increase in demand; less leads to decrease in demand for normal goods. (The rare case of goods whose demand varies inversely with income is called inferior goods).
d. Prices of related goods also affect demand.
i. Substitute goods (those that can be used in place of each other): The price of the substitute good and demand for the other good are directly related. If price of Budweiser rises, demand for Miller should increase.
ii. Complementary goods (those that are used together like tennis balls and rackets): there is an opposite relationship among price of one and demand for other when goods are complements.
e. Expectations—consumer views about future prices, product availability, and income can shift demand.
Define Direct and inverse relationships?
Speculators decrease price volatility through, in effect, changing demand curves: (w) out at low prices, and shifting supply curves out at high prices. (x) out at low prices, and shifting supply curves within at low p
What are the determinants of supply?
Illustrate several theories about causation?
numbers of sellers in pure competition?
Who will get the goods and services?
When the prices for doughnuts and croissants are $.50 and $1 correspondingly: (w) the opportunity cost for one doughnut is two croissants. (x) this is better to buy two doughnuts than one croissant. (y) one croissant will make Pierre twice as happy as one doughnut. (z
Growth is a significant economic goal. Explain?
If the price of a good is given, how does a consumer choose/decide as to how much of that good to purchase?
Why producers not be able to find enough paying buyers for “public goods”?
18,76,764
1928267 Asked
3,689
Active Tutors
1428296
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!