AP Microeconomics / Unit 2: Supply and Demand
2.1 Demand
Notes
Law of demand: price up, quantity demanded down (substitution and income effects).
- Demand shifters: tastes, income, related goods' prices, expectations, number of buyers.
Practice
The price of coffee rises. Demand for tea (a substitute):
People switch.
A change in a good's own price causes:
Change in quantity demanded.
Expecting a price rise next week, demand today:
Buy now.
Ready for more? Take the Unit 2 test.