23 shifts in the demand curve any change that raises

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Unformatted text preview: 50 $1. 00 $0. 50 $2. 50 $ 0. 00 0 2 4 6 8 10 12 Quantity of Ice­cream Cones Nicholas’s Demand $2. 00 $1. 50 Price of $3. 50 Ice­ $3. 00 cream Cone $2. 50 $1. 00 $0. 50 $2. 00 $0. 00 $1. 50 1 4 7 10 13 16 Quantity of Ice­cream Cones $1. 00 $0. 50 $0. 00 1 2 3 4 5 6 7 Quantity of Ice­cream Cones 19 2.2.3 Shifts in the Demand Curve Any change that raises Any the quantity that buyers wish to purchase at a wish given price shifts the demand curve to the right. Price of Price Ice-Cream Cone Cone Increase in Increase demand demand Decrease in Decrease demand demand D1 D3 Any change that lowers D2 the quantity that buyers wish to purchase at a given price shifts the demand curve to the left. demand Quantity of Ice­ cream Cones FIGURE 3 FIGURE Variables that Influence Buyers Variables 1. Income 2. Prices of Related Goods 3. 4. 5. Tastes or Preference Expectations Numbers of Buyers 1. Income 1. normal good a good for which, other things equal, an increase in income leads to an increase in demand inferior good a good for which, other things equal, an increase in income leads to a decrease in demand. 2. Price of Related Goods 2. Substitutes two goods for which an increase in the price of one leads to an increase in the demand for the other Complements two goods for which an i...
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This note was uploaded on 12/06/2011 for the course BUSINESS Finance taught by Professor Qiuxin during the Summer '11 term at Nanjing University.

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