Chapter-7 Flashcards
Demand (15 cards)
What is demand?
The willingness and ability to buy a product.
What is aggregation?
Aggregation is the addition of individual components to arrive at a total amount.
What is market demand?
Market demand is the total demand for a product.
What is extension in demand?
Extension in demand arises when there is a rise in the quantity demanded caused by a fall in the price of the product itself.
What is contraction in demand?
Contraction in demand arises when there is a fall in the quantity demanded caused by a rise in the price of the product itself.
What is decrease in demand?
A decrease in demand arises when there is a fall in demand at any given price, causing the demand curve to shift to the left.
What are changes in demand?
Changes in demand are the shifts in the demand cruve.
What is increase in demand?
An increase in demand arises when there is a rise in demand at any given price, causing the demand curve to shift to the right.
What are normal goods?
Normal goods are products whose demand increases when income increases and decreases when income falls.
What are inferior goods?
Inferior goods are products whose demand decreases when income increases and increases when income falls.
What is a substitute?
Substitute is a product that an be used in place of another.
What is complement?
Complement is a product that is used together with another product.
What is ageing population?
Ageing population arises when there is an increase in the average age of the population.
What is birth rate?
Birth rate is the number of live births per thousand of the population in a year.
What are the causes of chanegs in demand?
1) Changes in income
2) Changes in the price of related products
3) Advertising campaigns
4) Changes in population
5) Changes in taste and fashion
6) Other factors
