As the population and number of consumers increases, the overall demand for goods will also rise. Demand depends on factors like income, tastes, product preferences, prices of substitutes and complements, and special occasions. When income or the price of complements decrease, demand is likely to increase. However, if the price of substitutes decreases or income declines, demand may fall instead. Advertising can also impact tastes and demand over time.
3. As the population increase, the
number of potential consumers
will also increase
4.
5. • Normal goods – demand
increase as income increase
• Inferior goods – demand does
not increase even when the
income increase
• The increase in the demand of
an individual is due to the
income increase even if there
is no change in price
10. • When the price of one
commodity increase, the
demand for it will decrease.
• Substitute Goods
– Person can buy in place of other
goods
• Complementary Goods
– Consumed simultaneously
11.
12. • Change in taste and
preference for a particular
product affect the demand for
products.
• Advertisement influence the
consumers’ tastes
13.
14.
15.
16.
17. • Increase in income
• Product preference
• Expectation and
speculation
• Increase in the number of
consumers
• Celebration or occasion
• Price decrease of a
complementary product
18.
19. • Decrease in income
• Price increase of a
complementary good
• Consumers do not
speculate about price
increases
• Decrease in the number of
consumers
• Price decrease of
substitute goods
