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DP2 factors affecting demand, Podcast - the law of demand (22/4/21), DP3…
DP2 factors affecting demand
price
income
rise in income = demand for goods and services rise
the rise in income = consumers become more willing to spend
population
population size affects the total quantity of goods demanded, while age will affect the type of good demanded
With australia's
taste
when consumers taste change so does the demand of particular goofs
e.g. 2000s low rise jeans are coming back in the last few years
price substitutes
price of margarine rises so does butter because of substitutes
Expected Future Prices
e.g. If p
price of complements
if one of the complementary items rise, then other will likely rise as well
Podcast - the law of demand (22/4/21)
The idea of wanting something when prices get low. This applies to everyone.
set of decisions you make when you are a buyer
four core principles - margin principles - break down how many questions, cost-benefit principle pros and cons of each choice, interdependence principles is other factor than the price that affects whether the consumer purchases a product or not , opportunity principles
should l buy one more? margin principle
pros and cons about buying the coffee - cost benefit
opportunity principle - or what, comparing your hocie to your best aliteraive.
margin benefit - going to a cafe if its 5 dollars but not going when it increases
if the price go down even more, coffee people will go but new market will go.
congestive affect - if there are too many people in a line, you just leave. network effect - if there is your friend in a cafe you would more likely to get coffee
A marginal benefit is a maximum amount a consumer is willing to pay for an additional good or service
more income = more spending
preferences such as if you know that coffee is unhealthy you may switch to tea.
demand - buying decisions, the better the price, the more people will buy
DP3 movements along the demand curve and shifts of the demand curve
movement = how individual/market demand changes due to price
any movement from e to a or a to e, it is considered a contraction. As price increases, demand decreases.
any movement from e to b or b to e, it is considered an expansion. As prices decrease, the demand increases.
:check: Topic 3 - Markets :check:
:star: Demand and supply :star: