Sample Economics Essays On Demand and Supply

Homework Question on Demand and Supply

  • Please watch the video on Econ Movies Indiana Jones – Supply and Demand. After considering this video discuss the role of supply and demand in the economy – limit to 100 words
  • Here is the video link

Homework Answer on Demand and supply

The terms demand and quantity demanded are used a lot in the world of economics to mean two different things, and they should not be confused. Demand refers to the willingness of a customer to buy goods or services that he/she can afford. This means that desire alone without the ability to afford commodities or services not demand. Demand can also be defined as; the entire relationship between prices and the amount of goods or services a customer wants to purchase at each of the prices stated.

Change in demand is brought about by a number of factors for example change in income of the customer, change in price of related goods and service or a change in the taste of the customer. Change in demand represents a change in the demand structure to either the right or the left. Quantity demanded, conversely, addresses the sum of products or services demanded by an individual at one particular time and price. Change in quantity demanded is brought about by change in price. Change in quantity demanded represents a movement along an existing demand curve (Fisher 74).

Homework Help

Substitutes are goods and services, which can be used interchangeably with one other. In other words these are goods that serve the same purpose. A change in price of one of the goods affects the demand of the other because the customer can derive the same pleasure in the substitute good. For example, the price increase of margarine will increase the demand for butter since they are both used to serve the same purpose (Klein 87).