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Determinants of Supply and Demand

Determinants of Supply and Demand. Determinants of Supply and Demand. Factors that change the quantity demanded or supplied . Determinants of Demand. 1.Consumer preferences 2. Market Size 3. Income 4. Price of related goods 5. Consumer Security. Consumer Preferences. Tastes change

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Determinants of Supply and Demand

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  1. Determinants of Supply and Demand

  2. Determinants of Supply and Demand • Factors that change the quantity demanded or supplied

  3. Determinants of Demand • 1.Consumer preferences • 2. Market Size • 3. Income • 4. Price of related goods • 5. Consumer Security

  4. Consumer Preferences • Tastes change • What are some examples of tastes changing and therefore changing the amount of a product that is demanded?

  5. Market Size • The amount of people to buy the product may change • What is a situation where this may occur?

  6. Income • As the average income goes up or down, sales for products will also change • What is an example of this happening?

  7. Prices of related Goods • Substitutes- products easily replaced with others • Complements- products purchased together • What are some substitutes and complements?

  8. Consumer Security • If you feel good or anxious about future- it will affect how you spend money • Give examples

  9. Determinants of Supply • Technological improvement • Resource prices • Taxes and subsidies • Competition

  10. Technological Improvement • If productivity can increase

  11. Resource Prices • If prices of what goes into the product go up or down • Steel shortage?

  12. Taxes and Subsidies • Subsidy- monetary grant to a business to help ease production or develop a new product • Taxes- add to production costs

  13. Competition • More producers enter the market

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