D1 D1 D1 D1 D2D2D2D2 P QD 1 QD 2 increase in taste An increase
in taste for DVDs results in an increase in demand increase in
demand. decrease in taste A decrease in taste for videos results in
a decrease in demand decrease in demand. D3D3D3D3 QD 3
Slide 6
Increase in demand for dark chocolate after studies revealed
that there were health benefits from eating it. Scientists have
discovered that smokers who ate dark c hocolate had less hardening
of the arteries and a lowered risk of blood clots. D1D1D1D1
D2D2D2D2 P
Slide 7
D1 D1 D1 D1 D2 D2 D2 D2 P QD 1 QD 2 More income results in more
demand for new cars; less demand for used cars. New Cars Used Cars
Less income results in more demand for used cars; less demand for
new cars.
Slide 8
D1 D1 D1 D1 D2 D2 D2 D2 P QD 1 QD 2 More demand for both normal
& inferior goods New Cars Used Cars one billion Chinese new
potential This is what we told one billion Chinese, as new
potential consumerstrade relations 1972 consumers, when we opened
trade relations with them in 1972.
Slide 9
D1 D1 D1 D1 D2 D2 D2 D2 P QD 1 QD 2 iRate I f Steve Jobs
responds to iRate customers who iPhone iSorry bought the iPhone at
$599 and says, iSorry, we will raise the price back to $599 in 3
weeks. iPhone $399 Buy it now to save money.
Slide 10
D1 D1 D1 D1 D2 D2 D2 D2 P QD 1 QD 2 major shortage of toilet
tissue If there is expected to be a major shortage of toilet
tissue, then consumers will stock up now or risk not getting
any.
Slide 11
D1 D1 D1 D1 D2 D2 D2 D2 P QD 1 QD 2 coming out of recession
Lets say that we are coming out of recession & consumers
Positive future income feel secure about their jobs. [ Positive
future income ]
Slide 12
D1 D1 D1 D1 D2D2D2D2 P QD 1 QD 2 going into a recession Lets
say that we are going into a recession and consumers Negative
future income dont feel secure about their jobs. [ Negative future
income]
Slide 13
Complement [ Inverse ] Substitute [ Direct ] Milk Cereal Pop
Tarts D1D1D1D1 D2D2D2D2 P P1P1P1P1 QD 1 P2P2 D1D1D1D1 D2D2D2D2 D P
QD 2
Slide 14
Slide 15
1. Resource Cost [wages & raw materials ] [Inverse] Wages
Raw Materials Intel Pentium Chip S If resource cost decreases
supply Increases [making more $] If resource cost increases supply
Decreases [making less $] S S P
Slide 16
P1 QS1 Broccoli Substitutes in production I only have 200 acres
S Corn S1S1S1S1 P S2S2S2S2 QS1 QS1 S1S1S1S1 P S2S2S2S2 S Corn
Producers want to produce more of the good where price is
increasing, or at least, where the price is not going down.
Broccoli P2 QS2 QS2
Slide 17
S Because cows produce more milk, farmers dont have to have as
many cows. [ saves $ ] S P We love these cow waterbeds because we
get better blood flow and can produce 30% more milk. Supply curve
udderly moves udderly to the right. Less skin abrasions so happier
cows produce more milk. Mooooove over and give me that waterbed.
Waterbedsforcows.com
Slide 18
NFL S1S1P Q $50 $50 Supply of FB games increased when the XFL
was formed. S2S2S2S2 QS 1 QS 2 XFL in 2001 XFL in 2001 Because of
the XFLs cheerleaders many called this league, not the XFL, but the
Supply of FB games each week XXXFL XFL [Extreme Football League] 8
new teams More games each year
Slide 19
Bubba Gump Shrimp C ompany shrimp prices to increase more I f
the Bubba Gump Shrimp C ompany expects shrimp prices to increase
more in the future, they will supply (more/less) shrimp to the
market now. Bubba Gump Shrimp C ompany shrimp prices to decrease
more I f the Bubba Gump Shrimp C ompany expects shrimp prices to
decrease more in the future, they will supply (more/less) shrimp to
the market now. S1S1S1S1 [INVERSE] P S2S2S2S2 S2S2S2S2
Slide 20
S3S3S3S3 [Direct] P subsidies Free money from the government
(subsidies) induces suppliers to supply more. S1S1S1S1 S2S2S2S2 If
subsidies are taken away, then suppliers are losing money and will
decrease supply.
Slide 21
S3S3S3S3 [Inverse] P taxes decreased If business have their
taxes decreased, it moves the supply curve to the right. S1S1S1S1
S2S2S2S2 taxes increased If business have their taxes increased, it
moves the supply curve to the left. Im losing profits.