--%>
Assignment Help - homework help

How demand is influenced by price

Describe how the demand for a good is influenced by the price of its associated goods. Give illustrations.

E

Expert

Verified

Related goods are either replacements or complementary:

Substitutes Goods: Whenever price of a substitude falls or downs, it becomes less costly than given good. Therefore the consumer replaces it for given good will reduce.

Likewise, a rise in the price of substitute will outcome in rise in the demand for specific good. For illustrate Tea and Coffee.

Complementary Goods: Whenever the price of a complementary good falls or downs its demand rises and the demand for the specific good will raise. Likewise whenever price of complementary good rises, then demand
for specific good decreases. For illustration: ?Car and Petrol.

   Related Questions in Business Economics

  • Q : Firm costs and revenues Question:  You

    Question:  You are given the following data about two firms: FIRM A Quantity 0

    • Q : Calculate Equilibrium Quantity and Price

    1. The owner of a firm calculates that next year's profit will be $1,000. Each successive year profit will increase by 10% (i.e. year 2: $1100; year 3: $1210 and so on.) At the end of the 5th year the firm could be sold for $20,000. A) if the appropriate di
  • Q : Government policies with respect to the

    Can you explain how different government policies with respect to the recycling of aluminum and paper might account for these different market outcomes?

    		•
  • Q : Describe the equation of a linear

    Describe the equation of a linear relationship?

    		•
  • Q : Explain how an increase in state

    Use two market diagrams to explain how an increase in state subsidies to public colleges might affect tuition and enrollments in both public and private colleges.

    		•
  • Q : Larger amount is actually purchased at

    Critically evaluate:  “In comparing the two equilibrium positions, it note that a larger amount is actually purchased at a higher price. This disprove the law of demand.”

    		•
  • Q : Inefficiencies and inequities by

    An employer that exaggerates the safety of a position or the prospects for advancement to job applicants makes inefficiencies as well as arguable inequities due to: (1) signaling. (2) credentialism. (3) screening. (4) adverse selection. (5) a moral hazard.

  • Q : How can we calculate EPS How can we

    How can we calculate EPS?

    		•
  • Q : Key model of price-specie flow mechanism

    The key model underpinning David Hume’s price-specie flow mechanism which most mercantilists failed to grasp is termed today as: (i) the equimarginal principle. (ii) the wages-fund doctrine. (iii) the quantity theory of money. (iv) partial equil

    		•
  • Q : Single seller not sell at a price lower

    An individual seller within perfect competition will not sell at a price lower than the market price since: w) demand for the product will exceed supply.  x) the seller would begin a price war. y) the seller can sell any quantity she desires at the prevailing mar

    		•