This preview has intentionally blurred sections. Sign up to view the full version.View Full Document
Unformatted text preview: 1 st law of Demand: As P increases, qD decreases Income If income increases and… a. Demand increases, the good is normal b. Demand decreases, the good is inferior Price of other goods • If the price of good Y increases, and as a result the demand for good X increases the goods are substitutes (ex. gasoline and natural gas) • If the price of good Y increases, and as a result the demand for good X decreases the goods are compliments (ex. gas and SUVs)...
View Full Document
- Fall '07
- Supply And Demand, NYC