Marketing

Homework Chapter 4 – Halabi 1

Monique Halabi
Professor: Lawless
Eco 216
February 13, 2013

1. The law of demand states that the more we buy something, the less money we want to pay for it. I work for National Grid and the one of the examples I could give is, a lot people call complaining about high bills they believe that they shouldn’t be paying that much for it, they always want to pay less. The higher the price, the lower the quantity demanded. As the price goes up, so does the opportunity cost of buying that good.

2. If income increases there will be an increase in demand than consumers will have more money to spend. The more money a person has, the more they are willing and able to buy.

3. If chocolate was considered to be a benefit to one 's health then could cause an increase in the demand for chocolate products and a shift of the demand curve.

4. Input prices, taxes, price expectations and technology.
An increase in technology will increase supply. An increase in the price of something will decrease the supply.

5. If severe frost destroys part of Florida 's citrus, this would lead to a shift of the supply curve.

6. A. Peanut butter and jelly: Complements
B. Private and public transportation: Substitutes
C. Coke and Pepsi: Substitutes
D. Alarm clocks and automobiles: Unrelated
E. Golf clubs and golfs balls: Complements

7. A. I assume the demand for oil will go up.
B. There was an increase in supply.
C. Price increase.
D. Increase in supply.
E. Demand for oil would increase.