Gummiebear22 , 22

Ayesha Alleyne
Period #4
05.2.07
Chapter 4 Assessment and Activites
Identifying key terms
1.Demand
2.Change is quanitity demanded
3.Law of demand
4.Demand schedule
5.Change in demand
6.Microeconomics
7.Elastic demand
8.Demand curve

Section 1
1. A demand listing and a demand curve are alike because they both show the quantity demanded at all possible prices in the market at a given time.
2. When the diminishing marginal utility is encountered, it causes the demand curve to slope down ward.

Section 2
3. The income effect is appears when the individual make more or less money and their spending and buying habits change. The substitutional effect is when the consumer buys the cheaper product instead of the original if the prices rise.
4.There are five factors that can affect the change in demand market, they are; consumer income, consumer tastes, availability or substitutes, complements and the number of consumers.

Section 3
5. If the item can be waited on and is not really a need but a want, it is elastic. If it is really needed to in daily life, such a medicine and medical services, they are inelastic.
6. It calculates the amount that consumers spend on a product at a particular price.

Thinking critically
1. I do believe that it reflect the way most people behave in the market because in most situations, if the price rises, the consumer is most likely to spend less or find substitutes.
2. There would probably be no change in price and the consumer would continue to buy the same products.

Applying Economic Concepts
1. I believe that knowledge of demand would really be useful to me since i am a consumer and do have an income and taste in certain products. Keith Clinkscales know very much about consumer taste and fashion because he has to constantly come out with things to keep the consumer interested.
2. If everyone had an increase in pay, they would more likely eat out and buy more pizza especially if that company had a good advertising campaign. If there were a decrease in the price of hamburgers and new people were moving into the community, they demand for hamburgers would greatly rise.
3. By knowing elasticity, i would have products that many people need at prices that they would most likely accept. I would also sell complements and possible substitutes.

Math Practice
1. Price Quantity Demanded
$10 10
$20 6
$5 18
2.



3. The highest expeditures is $120 and the lowest is $90.

Ayesha Alleyne
Period #4
05.01.07

1. The income effect explains how the quantity demanded takes place because it shows how consumers spend when they make more and less money. They more they make, the more they are likely to spend on many different products or services. This also has an inverse relationship.

2. Change in quantity demanded- A movement along the demand curve that shows a change in the quantity of the product purchased in response to a change in price.
*Income Effect- The change in quantity demanded because of a change in price that alters consumers real income.
*Substitution Effect- The change is quantity demanded because of the change is the relative price of the product.
*Change in demand- Consumers demand different amount of every price, causing the demand curve to shift from the left to the right.
*Substitutes- Products that can be used in places of other products.
*Complements- Items that are usually bought and work together.

3. Change in quantity is where is item becomes less or more. Change in demand is where the demanded item is need.

4.If the price for the orginal product goes up, individuals are more likely to buy substitutes. If the price drops, they will buy more of the orginal product.

5. I bought bottle of water for $1. If it was to go on sale, i would probably buy more of that product. If a substitute was cheaper, i would buy that instead.

6. More people are likely to buy that product and if there was a complementry item, that would sell more too.

Summary
In Chapter 4 Section 2, the subject of demand is clearly addressed. Factors affecting demand are very great in the supply and demand situations. The change in quantity demanded plays a big part in this. It is a movement along the demand curve that shows a change in the quantity of the product purchased in response to a change in price. There are graphs that show that the quantity demanded takes place solely as a result in the change of price. In the change of demand, the change occurs when at the same prices consumers are willing and able to purchase different amounts of a product. Also, complements are items that are bought and used together. So if one price changes, both of their demands are affected. The numbe of consumers also causes the market demand to shift. If they were to leave, the prices would greatly decrease.











Ayesha Alleyne
Period #4
05.2.07

1. Three items that would have a higher price elasticity than other are mp3 players, designer clothing, and leather. These items would have a been very elastic because they are really not needed but some people would like to buy it even though it can be extremely expensive.

2.Elasticity- a measure of responsiveness that tells us how a dependent variable such as quantity responds to a change in an independent variable such as price.
*Demand elasticity- measure of responsiveness relating change in quantity demanded to a change in price.
*Elastic- type of elasticity where the percentage change in independent variable causes a more than porpotionate change in the dependent variable .
*Inelastic- type of elasticity where the percentage change in the independent variable causes a less proportionate change in the dependent variable.
*Unit elastic- elasticity where a change in the independent variable generates a poportional change of the dependent variable.

3.The first determinant of demand elasticity is "can purchase be delayed?". By asking this, you can determine if this item is elastic or inelastic. Other determinants is " are adequate substitutes available?", and "does this use a large portion of income?".

4. The demand for insulin is inelastic because no matter how the price changes, the consumer is still going to have to buy that product. It is a neccesity and not a luxury so the consumer might need it daily to stay healthy.

5. They are usually elastic because they can be easily replaceable. They tend to be things that are luxuries.

6. Airplane are reluctant to doing so because many people tend to travel at those times of the year and if they did offer reduced round trip airfares, they would be losing a large sum of money.

7. The demand for hamburgers are elastic because many people can live without eating at that stand and go somewhere else that is cheaper.

Summary
This section is about demand and the elastic effect that deal with it. Elasticity is addressed as a measure of responsiveness that tells us how a dependent variable such as quantity responds to a change in an independent variable such as price. There are two different types of elasticity; elastic and inelastic. These two have to do with how available an item is. There are 3 questions to ask in order to find out how elastic they are; "can purchase be delayed?", "are adequate substitutes available?", and "does purchase use a large portion of income?". If the item can be waited on and is not really a need but a want, it is elastic. If it is really needed to in daily life, such a medicine and medical services, they are inelastic.