ECON 103 Lecture Notes - Lecture 8: Demand Curve, Economic Surplus, Microsoft Powerpoint

• School: University of Victoria
• Department: Economics
• Course: ECON 103
• Professor: Emma Hutchinson

Document Summary

Normal- if you are willing to buy beer at price 1, then if you get richer you are likely willing to buy more at any price- a right shift. How much you are wtp for something: prices of related goods. Substitute- something you would consumer instead of beer. Ma(cid:455)(cid:271)e (cid:455)ou like to ha(cid:448)e a pie(cid:272)e of pizza (cid:449)ith e(cid:448)e(cid:396)(cid:455) (cid:271)ee(cid:396). If (cid:455)ou eat (cid:373)o(cid:396)e pizza, (cid:455)ou"ll want more beer. Tip- t(cid:396)(cid:455) a(cid:374)d (cid:449)alk th(cid:396)ough the logi(cid:272), do(cid:374)"t t(cid:396)(cid:455) to (cid:373)e(cid:373)o(cid:396)ize fo(cid:396) e(cid:454)a(cid:373) (cid:395)uestio(cid:374)s. Go through the practice of choosing two complements and substitutes then make different curve shifts, this will make exam easy: taste and preference. How you feel about beer could change how much beer you buy, example- if you suddenly decide you do(cid:374)"t like the taste o(cid:396) feeli(cid:374)g of (cid:271)ee(cid:396), (cid:455)ou (cid:449)ill o(cid:271)(cid:448)iousl(cid:455) (cid:271)u(cid:455) (cid:373)o(cid:396)e: expectations. If you think prices could change soon, you may decide to buy less or more of something.