Module 46 by h30116정진아 https://padlet.com/23h30116/p79erfgjwoc12562 en-us 2023-08-10 05:48:32 UTC 2023-08-10 15:25:40 UTC hello@padlet.com Definition 23h30116 https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659223242
change in the quantity of the good demanded that results from a change in the overall purchasing power of the consumer's income when the price of the good changes.]]> 2023-08-10 05:49:53 UTC https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659223242 Definition 23h30116 https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659225177
change in the quantity of the good demanded that results from a change in the overall purchasing power of the consumer's income when the price of the good changes.]]> 2023-08-10 05:52:59 UTC https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659225177 1. 23h30116 https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659225828 Income effect has no significant impact on individual consumption

-> Substitution effect make downward slope of demand curve]]> 2023-08-10 05:54:45 UTC https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659225828 2. 23h30116 https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659226808 Income effect reinforces the substitution effect.

Example)
When the price of a good that absorbs a substantial share of income rises, the consumer becomes a bit poorer because their purchasing power falls.

-> Reduction in income leads to reduction in the quantity demanded and reinforces the substitution effect. ]]> 2023-08-10 05:57:08 UTC https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659226808 Calculating the Price Elasticity of Demand 23h30116 https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659523578 percent change in quantity demanded to the percent change in price as we move
along the demand curve

(Change in quantity demanded/ initial quantity demanded) X 100
  • This equation represents the percent change in quantity demanded

(Change in Price/initial price)X100
  • This equation represents the percent change in price


]]> 2023-08-10 15:10:55 UTC https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659523578 23h30116 https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659524251 It is a measure of the responsiveness of the quantity demanded to changes in the price.]]> 2023-08-10 15:11:59 UTC https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659524251 Midpoint Method 23h30116 https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659524830 This calculates percent changes in prices and quantities based on the average of the initial and final values.]]> 2023-08-10 15:12:53 UTC https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659524830 Case of an inferior good 23h30116 https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659529326
  • opposite directions 
  • income effect
  • If people's income falls, the demand for an inferior good rises.
    • Inferior good: a good that its demand increases when income fall

    • ]]>     2023-08-10 15:18:17 UTC https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659529326     Real income 23h30116 https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659532414
  • income that reflects its true purchasing power
  • contrast to money income or nominal income

    • ]]>     2023-08-10 15:22:09 UTC https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659532414     23h30116 https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659533891 2023-08-10 15:23:41 UTC https://padlet.com/23h30116/p79erfgjwoc12562/wish/2659533891