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Journal Assessment PDF
Journal Assessment PDF
1) What are the two components needed in order to have a market? What do we call each of these?
Supply and Demand.
2) Define Demand
The desire for something and the means to pay for it.
3) Define and explain the law of demand…what is the relationship between price and quantity
demanded
As price goes up, demand goes down. As quantity goes up, prices goes down.
4) Explain the substitution and income effect and how they allow the law of demand to be true
As income increases, people buy more or different items. A substitution would be to buy a different
but similar product to save money.
5) What is a demand schedule?
The demand at given prices.
6) Given a demand schedule, what is a demand curve? The best you can draw a generic demand
graph with proper labels.