Introduction to the shifters of demand

By Alan Long

Multiple Choice

When a consumer is able and willing to buy a good or service, he/she creates what?

• consumption
• demand
• elasticity
• allocation

Multiple Choice

What shows the quantities of products demanded at each price by all consumers in a market? 

• a market pricing list
• a schedule of consumer prices
• a market demand schedule
• an elasticity and consumption list

Multiple Choice

What does this curve represent?

• supply
• equilibrium
• demand
• surplus

Multiple Choice

Which of these best describes the law of demand?

• if prices go up, quantity demanded will fall and if prices go down, quantity demanded will go up

• if prices go up, quantity demanded will also go up and if prices go down, quantity demanded will also go down

• there is no law of demand, each situation is unique and demand and prices cannot be predicted

• prices will go up for certain goods when quantity demanded goes up and vice versa

Multiple Choice

What causes a change in quantity demanded?

• A change in consumer income

• A change in production possibilities

• A change in the number of sellers

• A change in price

​In Economics (The TRIBE Acronym)

This is the most common meaning in an academic context, explaining shifts in the overall market demand curve. 

• Tastes & Preferences: Changes in consumer preferences (e.g., a new trend).

• Related Goods: Price changes in substitutes (e.g., Coke vs. Pepsi) or complements (e.g., printers & ink).

• Income: Changes in consumer purchasing power (e.g., winning the lottery).

• Buyers: Changes in the number or demographics of buyers (e.g., population growth).

• Expectations: Future predictions about prices or availability (e.g., expecting a future sale). 

​T.R.I.B.E.

T (Taste)
Like or Dislike:
If people like / Desire the good, the curve will shift right.
If people dislike the good, the curve will shift left.

Complimentary good price increases or decreases or availability may increase or decrease demand.

Substitute good price increases or decreases or availability may increase or decrease demand.

R
(Related Goods)
Compliments and substitutes

Multiple Choice

Identify which "Shifter" is involved:

A large group of high school students are getting tired of using Smart Phones, so a lot of students go buy the old school flip phones again because of the simplicity of life.

• Change in consumer income

• Change in consumer expectations

• Change in complementary goods

• Change in consumer taste of preference

Multiple Choice

If the price of a substitute good decreases, what happens to the demand for a product?

• Demand for the product becomes elastic.

• Demand for the product increases.

• Demand for the product decreases.

• Demand for the product remains the same.

Multiple Choice

When the price of hot dogs decreases and the demand for hot dog buns increases, this explains the demand of

• Complementary goods

• Capital Goods

• Substitute Goods

• Consumer Goods

An increase in income shifts the demand curve rightward. (Normal (new) Good)

An increase in income, the demand curve shifts leftward for an inferior/used good.

A decrease in income shifts the demand curve leftward. (Normal (new) Good)

A decrease in income shifts the demand curve rightward.
(Inferior/used good)

I
(Income)

Multiple Choice

Which of the following would lead to an INCREASE in the demand for golf balls? (New/ Normal Good)

• A decrease in the price of golf balls.

• An increase in the price of golf clubs.

• A decrease in the cost of producing golf balls.

• An increase in the average household income when golf balls are a normal good.

Multiple Choice

During a recession, economies experience increased unemployment and a reduced level of activity. How would a recession be likely to affect the market demand for new cars?

• Demand will shift to the right.

• Demand will shift to the left.

• Demand will not shift, but the quantity of cars sold per month will decrease.

• Demand will not shift, but the quantity of cars sold per month will increase.

Practice with T.R.I.

https://wayground.com/join?gc=47514998&source=liveDashboard

B - Buyers in the Market

​An increase in buyers (population), the demand curve shifts right.


A decrease in population, the demand curve shifts left

Multiple Choice

Which of the following would cause the demand curve to

shift to the right?

• a popular toys loses appeal

• suppliers expect higher prices in the future

• price of a substitute good decreases

• huge population increase

Multiple Choice

Thousands of people leave a small town due to a factory closing down. Sales at the local stores drop. What causes this change in DEMAND?

• Prices or availability of substitutes

• Prices or availability of complementary goods

• Change in Consumer Tastes/Preferences

• Change in # of Consumers/Population

Multiple Choice

What caused this to happen?

• Decrease in income
• Increase in Income
• Increase in price of substitute
• Decrease in price of complement

If the consumer believes prices will decrease in the future, they will buy less now, shifting the demand curve leftward.

E (Expectations of the consumer)

If the consumer believes prices will increase in the future they will buy more now shifting the demand curve rightward.

Multiple Choice

Identify which "Shifter" is involved: Kohl's announces a sale that is going to take place next weekend.

• Change in the number of consumers

• Change in complementary goods

• Change in consumer expectations

• Change in consumer tastes or preferences

Multiple Choice

I know that the iPhone 16 Pro is coming out next year but really need a phone badly. I'm thinking about buying an iPhone 15 when the new iPhone comes to the market because it will be much cheaper than today's price. What determinant of demand does this suggest?

• Change in Price of Complementary Good
• Change in Consumer Price Expectations
• Change in Number of Consumers in the Market
• Change in Consumer Income

Complete this activity to practice what you have learned in this introduction!