GFS Kosse Flashcards
(42 cards)
In the law of demand higher price equals what
less quantity demanded
In the law of demand lower price equals what
more quantity demanded
Law of Demand is what?
The quantity purchased varies inversely with price
Why does the demand slope down?
- law of diminishing marginal utility
- purchasing power
- tastes/preferences
Movement along the demand curve results from a change in price called a change in quantity demanded. T/F
True
What happens when their is a increase in demand?
The demand curve shifts outward, up and to the right.
What happens when there is a decrease in demand?
the demand curve shifts inward, down and to the left.
What are some important demand shifters? what shifts the demand curve?
- income
- population
- price of substitutes
- price of complements
- expectations
- tastes and preferences
The composition of food demand (or what we want to eat) is affected by what?
- expanded set of food choices from trade or other areas
- cultural norms
- individual tastes and preferences
- composition of population: household size, age, etc
- relative prices of different foods
The most important long-term sources of growth in food demand worldwide are…
income growth per capita (measured by analyzing the change of GDP over time) and population growth.
What is GDP?
Gross Domestic Product and is the market value of all final goods and services produced within a country in a year
GDP per capita equals…
GDP/population
GDP per capita means…
its the average GDP or the GDP per person
Engels law of consumption states
as real income rises, per capita food consumption continues to increase, but at a slower rate than income growth
what does the income elasticity of demand for food equal?
% change in money spent on food/1% change in real income
normal goods =
most foods are normal goods and as income rises food expenditures for most goods increases. Positive income elasticity
inferior goods =
as income rises per capita consumption declines. examples: potatoes and tubers. Negative income elasticity
increases in living standards and rising per capita income leads to what?
- increase in food consumed
- change in dietary composition
- diets become more varied
Who developed classical theory of the relationships between food, resources, and population
Thomas Malthus
What is demand?
Schedule of different quantities of a commodity that buyers are willing and able to purchase at different prices at a given time and place.
Thomas Malthus believed what?
- population growth was exponential
- food production was linear
- he also didn’t take technological growth into account
Thomas Malthus failed to account for what?
role of technology
improving social status
effective birth control
sustained economic development
Neo means what
new
What was stage one of the demographic transition?
High birth rates and high death rates
