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The law of demand indicates that as the price of a good increases?
Buyers
What factors may determine the quantity of a good that buyers demand?
Price of the good in question.
Explain the determinants as well as exceptions to law of demand?
The five ceteris paribus demand determinants are buyers' income, buyers' preferences, other prices, buyers' expectations, and number of buyers.Buyers' Income: The amount of income that buyers have available to spend on a good affects the ability to purchase a good. In general, income has a direct affect on the ability to buy a good, that is, more income means more buying. However, income can actually affect demand in two ways. For normal goods, more income means more demand. For inferior goods, however, more income means less demand.Buyers' Preferences: The satisfaction buyers obtain from a good, based on buyers' preferences, wants, needs, likes, and dislikes, affects the willingness to purchase a good. If a good provides greater satisfaction, then buyers are inclined to purchase more.Other Prices: The demand for one good is based on the prices paid for other goods purchased by buyers. A change in the price of a substitute good (or substitute-in-consumption) induces buyers to alter the mix of goods purchased. An increase in the price of a substitute motivates buyers to buy more of one good and less of the substitute good. A change in the price of a complement good (or complement-in-consumption) induces buyers to demand more or less of both goods. An increase in the price of a complement motivates buyers to buy less of one good as they buy less of the complement good.Buyers' Expectations: The decision to purchase a good today depends on expectations of future prices. Buyers seek to purchase the good at the lowest possible price. If buyers expect the price to decline in the future, they are inclined to buy less now. If they expect the price to rise in the future, they are inclined to buy more now.Number of Buyers: The number of buyers willing and able to buy a good affects the overall demand. With more buyers, there is more demand. With fewer buyers, there is less demand.
Demand is said to be elastic if?
buyers do not respond much to changes in the price of the good.
What does it mean when demand for good is relatively inelastic?
when demand for good is relatively inelastic The good is regarded by the consumers as a necessity. There are large buyers of the substitues for the good. Buyers spend a small percentage of their total income on the product. Consumers have had only a short time period to adjust to changes in price.
The law of demand indicates that as the price of a good increases?
Buyers
What factors may determine the quantity of a good that buyers demand?
Price of the good in question.
Explain the determinants as well as exceptions to law of demand?
The five ceteris paribus demand determinants are buyers' income, buyers' preferences, other prices, buyers' expectations, and number of buyers.Buyers' Income: The amount of income that buyers have available to spend on a good affects the ability to purchase a good. In general, income has a direct affect on the ability to buy a good, that is, more income means more buying. However, income can actually affect demand in two ways. For normal goods, more income means more demand. For inferior goods, however, more income means less demand.Buyers' Preferences: The satisfaction buyers obtain from a good, based on buyers' preferences, wants, needs, likes, and dislikes, affects the willingness to purchase a good. If a good provides greater satisfaction, then buyers are inclined to purchase more.Other Prices: The demand for one good is based on the prices paid for other goods purchased by buyers. A change in the price of a substitute good (or substitute-in-consumption) induces buyers to alter the mix of goods purchased. An increase in the price of a substitute motivates buyers to buy more of one good and less of the substitute good. A change in the price of a complement good (or complement-in-consumption) induces buyers to demand more or less of both goods. An increase in the price of a complement motivates buyers to buy less of one good as they buy less of the complement good.Buyers' Expectations: The decision to purchase a good today depends on expectations of future prices. Buyers seek to purchase the good at the lowest possible price. If buyers expect the price to decline in the future, they are inclined to buy less now. If they expect the price to rise in the future, they are inclined to buy more now.Number of Buyers: The number of buyers willing and able to buy a good affects the overall demand. With more buyers, there is more demand. With fewer buyers, there is less demand.
Demand is said to be elastic if?
buyers do not respond much to changes in the price of the good.
What does it mean when demand for good is relatively inelastic?
when demand for good is relatively inelastic The good is regarded by the consumers as a necessity. There are large buyers of the substitues for the good. Buyers spend a small percentage of their total income on the product. Consumers have had only a short time period to adjust to changes in price.
Why market prices are better than government determined prices?
Market prices tend to an equilibrium where buyers' demand for the good is worth less than the sellers' cost of supplying the good. Put another way, buyers are willing to pay less than the amount producers are willing to accept. Government sets its prices above or below this point. If the price is above the equilibrium buyers will demand less than producers supply. On the other hand, if price is below the equilibrium sellers will supply less than buyers demand.
Buyers' requests for products is called?
demand
If a demand curve shifts rightward this means?
Quantity buyers are willing and able to purchase more of the good every price.
Do buyers and sellers as one group determine demand but only seller determine supply?
Yes. Buyers want a product and those that sell it regulate how much of it they sell to the buyers, therefore controlling the supply as a result of the demand.
What factors shift the demand curve?
the price of the good, customer income,tastes, expectations,number of buyers,price of related goods.
Definitions of income elasticity of demand?
income elasticity can be applied in the intersection of market demand and supply. when there is income inequality people with less income get to buy less goods than they would have wanted this affects the suppliers who will have to reduce their goods to be supplied.
What does elasticity of demand measure?
c)how buyers will cut back or increase their demand when price rises or falls =)
