Lecture 4_v2.pdf

This means that demand curves slope downward other

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This means that demand curves slope downward.

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Other Properties of Demand Curves Demand curves intersect the quantity ( X )-axis, as a result of time limitations and diminishing marginal utility. Demand curves intersect the ( Y )-axis, as a result of limited incomes and wealth.
Demand Curve Shifters: # of buyers An increase in the number of buyers causes an increase in quantity demanded at each price, which shifts the demand curve to the right.

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\$0.00 \$1.00 \$2.00 \$3.00 \$4.00 \$5.00 \$6.00 0 5 10 15 20 25 30 P Q Suppose the number of buyers increases. Then, at each price, quantity demanded will increase (by 5 in this example). Demand Curve Shifters: # of buyers
Income and Wealth Income is the sum of all households wages, salaries, profits, interest payments, rents, and other forms of earnings in a given period of time. It is a flow measure. Wealth , or net worth , is the total value of what a household owns minus what it owes . It is a stock measure.

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