Econ Lecture 5 9.7

Econ Lecture 5 9.7 - Econ Lecture 5 9/7 15:03 Opening...

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Econ Lecture 5 9/7  15:03 Opening Questions Bad weather wreaks havoc with tea crop what is the effect on a market price and  market quantity? Inc market price dec in market quantity Medical report claimes tea causes tooth decay what is the effect Decrease in market price and market quantity  Tech innovation lowers the cost of producing tea Decrease in market price increase in market quantity. Consumers income falls – assume tea is a normal good –  Decrease in market price and market quantity What affects tastes that affect demand? Shift our demand curves Arm and Hammer – baking soda convinces people that you need it not to  cook but to put it in other things in other reasons. Religions are changing tastes o Christianity will inc demand for bibles o Buddhism – forgetting about preferences – demand (preferences) Forget about “consumer demand”
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This note was uploaded on 01/19/2011 for the course ECON 2005 taught by Professor Zirkle during the Fall '07 term at Virginia Tech.

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Econ Lecture 5 9.7 - Econ Lecture 5 9/7 15:03 Opening...

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