Transcript Demand Shifts - Cloudfront.net

S&D:
Demand Shifts
1. What is the
equilibrium price?
2. If the quantity
demanded is 32,
is there a
shortage or a
surplus?
3. If the price is $15
is there a
shortage or a
surplus?
Refer to Figure
6.1, the graph on
Equilibrium in the
Pizza Market, on
p. 165.
Remember:
Determinants of Demand
1. Change in real income
•
•
Normal goods
Inferior goods
2. Change in price of substitutes or
complements
3. Change in consumer expectations
4. Growth in population
5. Change in consumer tastes
Demand Shifts for Pizza
• EQ price?
• Price for hamburgers
increases, what will
happen to the demand
for pizzas?
• New EQ price?
Refer to Figure 4.6, the
graph on An Increase in
the Market Demand for
Pizza, on p.119.
How demand shifts affect
PRICE
• If increase in D =
–Price will increase
• If decrease in D =
–Price will decrease
Price changes at all quantities.
If the price of airline tickets
increase, what will happen to
the demand for hotel rooms?
What will happen to the price
of hotel rooms?