Demand

Question 1

What is demand?

Answer 1

Quantity of a good or service that consumers are willing and able to buy at a given price at a specific time

Question 2

What is marginal utility?

Answer 2

Extra satisfaction derived from consuming one extra unit of the good

Question 3

Why is the demand curve downwards sloping ?

Answer 3

Diminishing marginal utility, consumer surplus declines with extra units produced

Question 4

What happens with an increase in price ?

Answer 4

Becomes more expensive than alternatives, substitution effect, If disposable income reduces, this is the income effect

Question 5

What is derived demand?

Answer 5

demand for one food related to demand of another good

Question 6

What is composite demand ?

Answer 6

the food demanded has more than one use

Question 7

Joint demand is …

Answer 7

Goods are brought together such as a camera and memory card

Question 8

What is competitive demand ?

Answer 8

Demand for goods which are substitutable

Question 9

What is expansion of demand ?

Answer 9

At lower price a larger quantity is demanded (Than equilibrium)

Question 10

What is a contraction in demand ?

Answer 10

At a higher price a lower quantity is demand

Question 11

What are the factors that Shift the demand curve?

Answer 11

P- Population, larger = more
I- Income
R-Related goods (substitutes)
A-Advertising
T- Tastes and fashions
E-expectations , speculation
S-Seasons over the year