theme 3

Question 1

factors that cause a shift in the demand curve

Answer 1

substitute product
-act as an alternative therefore creating completion and reducing demand if price A goes up product B demand will go up

a completamnet product
- if the product bought along is demand is high or low e.g is cars a cheap petrol will go up in demand

changes in real income
- if people income go up normal goods demand will go up

-customers’ fashion trends over time

Question 2

how are changes in demand shown a graph

Answer 2

An increase in demand is shown by a shift to the right

A decrease in demand is shown by a shift to the left

Question 3

law of demand and reasons

Answer 3

inverse relationship between price and quantity demanded

substation effect
income effect
law of diminishingmarginal utility

Question 4

define a market

Answer 4

anywhere buyers and sellers come togheter to exchange products/services

Question 5

shifters of supply

Answer 5

prices of resources to make thing (milk for ice cream)
technology (new machine)
government involvement (tax on things)
number of sellers

Question 7

the rationing function

Answer 7

excess demand for a good or service will to a rise in the price of a good or service due ti the scarcity of the product, price rise means less demand
, this leads to rationing of the product

Question 8

incentive function

Answer 8

higher prices act as a motivator for produces to increase the supply of a good