Demand Flashcards
1
Q
What is demand
A
Quantity of a good or service that consumers are willing to buy at a given price
2
Q
What’s the theory of demand
A
Inverse relationship between price and quantity demanded of a good
3
Q
What is the Real income effect
A
As price rises people will feel poorer as they will not be able to buy as much of what they want
4
Q
What’s the substitution effect
A
People will switch to alternatives as the price for what they want rises
5
Q
5 changes which cause a shift in demand
A
Taste , income ,price of complements/substitutes , demand in other products
6
Q
What do we do if there’s a change in a non-price determinants
A
Shift the demand curve
7
Q
If we change price what happens
A
Movement along demand curve
