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MacroEconomics 201 practice quizzes and exams

MacroEconomics 201 practice quizzes and exams - -Inferior...

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Econ 201 – Notes for September 24, 2010 - P & QD has an inverse relationship (P= price, QD= Quantity Demanded) - A shift in demand because we have two curves, which means we are not talking about the change in price. - With a change in price all we do is move from one place to another on the same curve. - At the same price we can now afford more of the goods because of the non price factors: 1. Market size – how many customers on the market for this product. An increase in population is show by a shift to the right on the demand curve. Numbered from the left to the right means it is increasing. 2. Income – when your income increase, you are allowed to buy more. -Normal good – when your income increases the demand increases
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Unformatted text preview: -Inferior good – when your income increases the demand decreases, or if income decreases the demand increases. 3. Consumer Price Expectation - (check notes in notebook) 4. Taste & Preference – 5. Prices of Related Goods – Xand Y are related when a change in the price of X and effects the demand of the Y. - Substitute goods do basically the same thing.(ex. hotdogs and hamburgers)- Complement goods are goods that go together, so that an increase in the price one make the other price goes down. (ex. coffee and cream) SUPPLY: Non-price factors for supply: 1. number of products 2. input of cost 3. technology 4. price expectation 5....
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