Ceteris Paribus Ceteris paribus is a Latin phrase that means all variables other than the ones being studied are assumed to be constant. Literally, ceteris paribus means other things being equal. The demand curve slopes downward because, ceteris paribus, lower prices imply a greater quantity demanded Harcourt, Inc. items and derived items copyright o 200l by harcourt, Inc
Harcourt, Inc. items and derived items copyright © 2001 by Harcourt, Inc. Ceteris Paribus Ceteris paribusis a Latin phrase that means all variables other than the ones being studied are assumed to be constant. Literally, ceteris paribus means “other things being equal.” The demand curve slopes downward because, ceteris paribus, lower prices imply a greater quantity demanded!
Market demand Market demand refers to the sum of all individual demands for a particular good or service. Graphically, individual demand curves are summed horizontally to obtain the market demand curve Harcourt, Inc. items and derived items copyright o 200l by harcourt, Inc
Harcourt, Inc. items and derived items copyright © 2001 by Harcourt, Inc. Market Demand Market demand refers to the sum of all individual demands for a particular good or service. Graphically, individual demand curves are summed horizontally to obtain the market demand curve
Determinants of demand Market price Consumer income Prices of related goods Tastes Expectations Harcourt, Inc. items and derived items copyright o 200l by harcourt, Inc
Harcourt, Inc. items and derived items copyright © 2001 by Harcourt, Inc. Determinants of Demand Market price Consumer income Prices of related goods Tastes Expectations
Change in Quantity Demanded versus Change in Demand Change in Quantity Demanded Movement along the demand curve Caused by a change in the price of the product. Harcourt, Inc. items and derived items copyright o 200l by harcourt, Inc
Harcourt, Inc. items and derived items copyright © 2001 by Harcourt, Inc. Change in Quantity Demanded versus Change in Demand Change in Quantity Demanded Movement along the demand curve. Caused by a change in the price of the product
Changes in Quantity Price of Demanded Cigarettes per Pack A tax that raises the price of cigarettes 车400}…… results in a movement along the demand curve. 2.00 DI 20 Number of Cigarett Harcourt, Inc. items and derived items copyright o 200l by harcourt, Inc Smoked per day
Harcourt, Inc. items and derived items copyright © 2001 by Harcourt, Inc. Changes in Quantity Demanded 0 D1 Price of Cigarettes per Pack Number of Cigarettes Smoked per Day A tax that raises the price of cigarettes results in a movement along the demand curve. A C 20 2.00 $4.00 12