BUSN6120_MidTerm

BUSN6120_MidTerm - 1. A) Describe a product demand curve...

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1. A) Describe a product demand curve and give the factors that give it its typical slope. A demand curve is a graphical illustration of a demand schedule. Each point on the curve refers to a specific quantity that will be demanded at a given price. If, for example, the price of web-design tutoring were $35 per hour, this curve tells us the consumer would purchase 5 hours per semester. If web services cost $30 per hour, 7 hours per semester would be demanded. Each point on the curve corresponds to a row in the schedule. A demand curve is a curve describing the quantities of a good a consumer is willing and able to buy at alternative prices in a given time period, ceteris paribus. Each demand curve has determinants: Desire from consumers to buy good based on taste The income of a consumer The availability of other goods The consumer’s expectations Number of buyers When the determinants of demand remain constant, the product demand curve remains unchanged. If the ceteris paribus assumption is broken or one of the determinants have changed, the demand curve will shift to a new position. A shift in demand is a change in the quantity demand at a given point. Shifts of the demand curve occur when the determinants of demand change. It is also
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This note was uploaded on 06/09/2011 for the course BUSINESS 5970 taught by Professor Jhon during the Spring '09 term at Webster.

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BUSN6120_MidTerm - 1. A) Describe a product demand curve...

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