1.4 Flashcards
1
Q
demand
A
quantity of goods/service consumers are willing and able to pay
2
Q
law of demand
A
inverse relationship betw. prices and quantity demanded
3
Q
5 determinants of demand
A
Taste and preferences (trends)
Income
Market size (# of buyers)
Expectations of future prices
Related goods (substitutes & complements)
4
Q
normal goods
A
income increase
demand increase
vice versa
5
Q
inferior goods
A
income increase
demand increase
vice versa
6
Q
substitutes
A
goods used in place of another
7
Q
complements
A
goods bought and used together
8
Q
expectation of future prices
A
if consumer expects price to increase in the future, they increase their demand today
vice versa
