Demand & goods

Intros
Lessons
1. Demand & Goods Overview:
2. Demand & Goods Terminology
• What it means to demand
• Types of Goods
3. Law of Demand and Demand Curve
• What it looks like graphically
• What it looks like algebraically
• Willingness to Pay
• Substitution Effect
• Income Effect
• Linear equation only for beginner microeconomics
4. Change in Demand
• Increase in demand
• Decrease in demand
• Factors for Change in Demand
Examples
Lessons
1. Understanding the Types of Goods and Law of Demand
____________ are goods that are almost identical to each other.
1. Substitutes
2. Inferior goods
3. Complements
4. Perfect Substitutes
2. Suppose that you enjoy coffee, and your income increases this month. Would you buy more of instant coffee? Why or why not?
1. Suppose the price of apples went from $0.50 to$1.00, and assume that no changes in average income, population, or any other influences caused this to happen. Explain how the rise in the price of apples will affect the demand for apples, and the quantity of apples demanded.
1. Using the Demand Curve
Using the follow information from the table, graph the demand curve.
 Quantity Demanded (Chocolate) Price (dollars) 20 1 15 2 11 3 8 4 6 5
1. Using the demand curve P = a - $bQ_{D}$, find:
1. The price of the good if a = 50, b = 2, $Q_{D}$ = 2
2. The quantity of the demand if a = 40, b = 3, P = 5
2. Understanding the Change in Demand
Suppose you know that your income will increase 20% next month. How would your demand and demand curve change for
1. Cheap Clothes?
2. Expensive Clothes? Explain
3. When there is an increase in demand, the demand curve shifts _______________. When there is a decrease in demand, the demand curve shifts ___________________.
1. Rightward, Rightward
2. Rightward, Leftward
3. Leftward, Rightward
4. Leftward, Leftward