LS8 - Demand Flashcards
What is demand?
The quantity of a food or service purchased at a given price over a given time period.
What is the law of demand?
Ceteris paribus, as the price of a good increases, quantity demanded decreases. Conversely, as the price of a good decreases, quantity demanded increases
What does a decrease in price on the demand curve show?
A movement and an extension/ expansion in demand (shifts right)
What does an increase in price lead to on the demand curve?
A contraction in demand which can be shown by a movement along the demand curve. (Demand shifts left)
What are substitute goods?
Two alternative goods used for the same purpose
What are compliment goods?
Products used together
What can affect demand?
A change in age structure, income (increase will lead to more demand), successful advertising and changes in consumer taste.
