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    This document summarizes factors that can increase or decrease supply and demand. It lists factors such as expectations of future prices, advertising, income levels, prices of substitutes and complements, costs of production, and government policies as things that can cause supply or demand to rise or fall. It also provides questions to help determine whether demand or supply for a particular good is elastic or inelastic.

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    This document summarizes factors that can increase or decrease supply and demand. It lists factors such as expectations of future prices, advertising, income levels, prices of substitutes and complements, costs of production, and government policies as things that can cause supply or demand to rise or fall. It also provides questions to help determine whether demand or supply for a particular good is elastic or inelastic.

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    © All Rights Reserved
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    2 views1 page

    Cheat Sheet

    Uploaded by

    imran.alam
    This document summarizes factors that can increase or decrease supply and demand. It lists factors such as expectations of future prices, advertising, income levels, prices of substitutes and complements, costs of production, and government policies as things that can cause supply or demand to rise or fall. It also provides questions to help determine whether demand or supply for a particular good is elastic or inelastic.

    Copyright:

    © All Rights Reserved
    Download as DOC, PDF, TXT or read online from Scribd
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    Supply and Demand Increase/Decrease Factors

    Factors That Can Increase Demand Factors That Can Decrease Demand
    Expectation of higher price in future Expectation of lower price in future
    Advertising/Popularity/Taste Popularity/Taste
    Decreased Price of Complements Increased Price of Complements
    Increased Price of Substitutes Decreased Price of Substitutes
    Increased Income Decreased Income
    Increased Population Decreased Population

    Factors That Can Increase Supply Factors That Can Decrease Supply
    Decreased Cost of Materials Increased Cost of Materials
    Decreased Cost of Labor Increased Cost of Labor
    New Technology Taxes
    Government Regulation
    Government Subsidies Expectation of Higher Price in future
    Expectation of Lower Price in Future Businesses Leave the Market
    New Businesses Open Inflation

    ELASTICITY

    Answer the following questions in complete and detailed sentences. This will help you
    write your paragraphs about elasticity.

    DEMAND (Y = elastic; N = inelastic)


    1. Can people wait to buy this product?
    2. Are there any substitutes for your product?
    3. Is your product expensive—does it take up a large amount of someone’s budget?
    4. Is this product considered a luxury?
    5. Do people have enough time to adjust to the price change?

    SUPPLY (Y = elastic; N = inelastic)


    1. Can your goods be produced quickly in the factory (or elsewhere)?
    2. Can your business quickly and easily change its level of production?
    3. Can your product be stored for a long time without losing its value?
    4. How easily can the business change their output levels?
    5. How will the business adjust to a price change?
    6. If prices increase, can the business increase their supply quickly?
    7. If prices decrease, can the business decrease their supply quickly?

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