Demand Shifters

Complete the following lesson by logging on to:

 http://www.econedlink.org/lessons/index.php?lid=550&type=student                                  

Read and follow all directions. Use your notes for help. Email me your results when it asks.

DEMAND SHIFTERS

Part 1

Use the demand schedule for bubble soda to answer multiple choice questions about quantity demanded. When you have finished, email the result to me at;

ostmanj@cheboygan.k12.mi.us

Remember the relationship between price and quantity demanded is inverse and is called the Law of Demand. Demand is the relationship between various prices and the quantities consumers are willing and able to buy during some time period, holding all other things constant. Demand is not a single price and quantity demanded from the schedule. Demand is the entire schedule.


The demand schedule can also be displayed as a graph. Use the demand graph for Bubble Soda to answer these questions. Please type your answers in the space provided and email me the results

 

 

Part 2

1. What does the demand curve look like?
    

2. Why is the curve downward sloping?
    

3. What is the one factor that resulted in consumer tastes for Bubble Soda to change?
    

4. Why are consumers willing and able to buy more of a product at a lower price?

 Part 2

For part 2, put your answers in the computer and the check your work. This is just practice!!!

Part 3

What could cause a change in the quantity demanded at each and every price? The factors that cause this type of change are called nonprice determinants.

Non price determinants include:
Review these by clicking on them (you do have these in your notes however)

• Change in the number of consumers in the market for a product

• Change in consumer tastes and preferences for a product

• Change in consumer income

• Change in the price of related goods—complements

• Change in the price of related goods—substitutes

Use the Bubble Soda (Click on this link) example and determine how demand would change and why for each of the examples.

CONCLUSION

In this lesson you have reviewed the law of demand and how price changes affect the amount of a good or service consumers are willing and able to buy. You also learned about the non-price determinants of demand. Non-price determinants result in a change in demand. A change in demand means that the amount consumers are willing and able to buy changes at each and every price. Non-price determinants are sometimes called demand shifters. Test your knowledge by completing the attached true/false quiz. Email me these results.

ASSESSMENT ACTIVITY

Complete the multiple choice evaluation.  Print results and hand in when you are finished. Email me these results.

EXTENSION ACTIVITY

Look for current events related to demand shifters that will affect the price of the stocks that you have purchased. Click on your Portfolio and look at “Latest News on Your Holdings”. For each example you find, identify the demand shifter and the resulting change in demand. Summarize the news as it relates to your stock, tell me what category of determinant of demand this is, what action you are going to take as far as buying it or selling it and finally, do you think the price of the stock will increase or decrease. Write this on line paper or type it and hand it in.

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NEXT…Go to the following website, read all instructions and print out your responses and staple to this packet. Finally, answer the questions on the last page of this handout

http://www.econedlink.org/lessons/index.cfm?lesson=EM458