Day 6 slides - Demand: Part 2 Today's Outline Refresher...

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1 Microeconomics Principles January 30, 2008 Demand: Part 2 Today’s Outline Refresher Quantity Demanded vs. Change in Demand If time, Start Supply Understanding the Market : Chapter 3 Refresher: Marginal Marginal Analysis Marginal: z Unit by Unit decisions/choices z incremental, additional unit, last unit, next unit The goal: MB = MC z Marginal benefits (MB) z Marginal costs (MC) Refresher: Demand Chapter 3 He he – you said Demand If the price of a good rises, what will happen to the quantity demanded by consumers? Law of Demand the quantity demanded of a good falls when the price of that good rises , other things being equal
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2 Change in Quantity Demanded = Movement Along Curve Due to Change in Price z Move from Q2 to Q1 b/c price decrease from P2 to P1 z Known as Change in Quantity Demanded P1 P2 Q1 Q2 NEW: What else affects Demand for a good? 9 Price ± Income (How much on your Maine Card?) ± Price of Related Goods ± Compliments ± Goes with a Good; ex: Milk and Cookies ± Substitutes ± Have instead; Ex: Pie OR Cookie What affects Demand for a good?
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This homework help was uploaded on 04/18/2008 for the course PHY 121 taught by Professor Smith during the Spring '08 term at University of Maine Orono .

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Day 6 slides - Demand: Part 2 Today's Outline Refresher...

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