2.3 Demand

Question 1

Define Demand

Answer 1

The willingness of consumers to buy a good or services at a given price

Question 2

The effective demand for a particular good or service is called?

Answer 2

Quantity Demanded

Question 3

Define Individual Demand

Answer 3

The demand from one consumer

Question 4

Define Market Demand

Answer 4

The total (aggregate) demand for the product

Question 5

Define the Law of Demand

Answer 5

An increase in price leads to a decrease in demand, and a decrease in price leads to an increase in demand

Question 6

List 3 Factors that cause shifts in a demand curve

Answer 6

Consumer Incomes
Taxes on Incomes
Price of Substitutes

Question 7

Explain how consumer incomes causes a shift in a demand curve

Answer 7

A rise in consumers’ incomes increases demand, causing a shift to right; vice versa

Question 8

Explain how taxes on incomes causes a shift in a demand curve

Answer 8

A rise in tax on incomes means less demand, causing a shift to the left; and vice versa

Question 9

Explain how prices of substitutes causes a shift in a demand curve

Answer 9

A rise in the price of a substitute causes a rise in the demand for the product, causing the demand curve to shift to the right; and vice versa