Real-World Examples of Demand Schedules & Curves (AP Micro)

📚 Quick Study Guide: Demand Schedules & Curves

• 🎯 Demand Schedule: A table showing the quantity of a good or service that consumers are willing and able to purchase at various prices during a specific period, holding all other factors constant.
• 📉 Demand Curve: A graphical representation of the demand schedule, illustrating the inverse relationship between price and quantity demanded. It typically slopes downward from left to right.
• 🧠 Law of Demand: States that, all else being equal (ceteris paribus), as the price of a good or service increases, the quantity demanded decreases, and vice versa.
• 💡 Change in Quantity Demanded vs. Change in Demand:
  • 📈 Change in Quantity Demanded: A movement *along* the demand curve caused solely by a change in the price of the good itself.
  • 🚀 Change in Demand: A shift of the *entire* demand curve (either left or right) caused by a change in one of the non-price determinants of demand.
• 📊 Determinants of Demand (Shifters): Factors that can shift the entire demand curve. These include:
  • 💰 Income: For normal goods, demand increases with income; for inferior goods, demand decreases with income.
  • 🧑‍🤝‍🧑 Tastes & Preferences: Changes in consumer preferences can increase or decrease demand.
  • 💲 Price of Related Goods:
    • 🍎 Substitutes: Goods used in place of one another (e.g., if coffee price rises, demand for tea increases).
    • 🍊 Complements: Goods used together (e.g., if car price falls, demand for gasoline increases).
  • 🔮 Consumer Expectations: Beliefs about future prices or income can affect current demand.
  • 👨‍👩‍👧‍👦 Number of Buyers: An increase in the number of consumers in the market increases overall demand.
• 📝 Graph Interpretation: Price is on the vertical (Y) axis, and quantity demanded is on the horizontal (X) axis.

📝 Practice Quiz: Demand Concepts

1. A local coffee shop observes that when it lowers the price of its specialty latte from $5.00 to $4.00, the number of lattes sold per day increases from 100 to 130. This observation best illustrates which economic concept?

1. The Law of Supply
2. A shift in the demand curve
3. The Law of Demand
4. An increase in consumer income

2. Which of the following would cause a movement *along* the demand curve for organic avocados, rather than a shift of the entire curve?

1. A new scientific study highlighting the health benefits of avocados.
2. An increase in the price of conventional (non-organic) avocados.
3. A decrease in the price of organic avocados.
4. A celebrity chef endorsing organic avocados on national television.

3. Suppose the demand for concert tickets to a popular band increases. Which of the following scenarios would lead to this increase in demand?

1. The price of concert tickets decreases.
2. The band announces a new album release immediately after the tour.
3. The cost of producing concert tickets decreases.
4. A substitute good, such as streaming music, becomes significantly cheaper.

4. A decrease in the price of gasoline leads to an increase in the quantity demanded for larger, less fuel-efficient vehicles like SUVs. This relationship demonstrates that gasoline and SUVs are:

1. Substitute goods.
2. Inferior goods.
3. Normal goods.
4. Complementary goods.

5. A local bakery experiences a significant decrease in demand for its artisanal bread. Which of the following is the *most likely* cause for a *shift to the left* of the demand curve for this bread?

1. The bakery lowers the price of its artisanal bread.
2. The price of flour, a key ingredient, increases.
3. A new competitor bakery opens nearby offering similar bread at lower prices.
4. Consumers' incomes increase, and artisanal bread is considered a normal good.

6. If consumers expect the price of smartphones to significantly decrease next month, what will likely happen to the demand for smartphones *today*?

1. The quantity demanded will increase.
2. The demand curve will shift to the right.
3. The demand curve will shift to the left.
4. There will be no change in demand, only a change in quantity supplied.

7. Consider a demand schedule for movie tickets:

1. An increase of 20 tickets.
2. A decrease of 40 tickets.
3. An increase of 40 tickets.
4. A decrease of 20 tickets.