Demand and Substitution Effects

This video explains how substitute products act as non-price determinants of demand. Using apples and bananas as examples, it illustrates how a price increase in apples leads to a decrease in their demand, causing consumers to shift to bananas. This shift results in a rightward shift in the demand curve for bananas, as they become relatively cheaper. The video concludes with a preview of the next topic on complementary products.

What is a non-price determinant of demand discussed in the video?

• Substitute products

• Consumer income

• Technological advancements

• Government policies

What is the relationship between apples and bananas in this context?

• Unrelated goods

• Substitute goods

• Complementary goods

• Inferior goods

What happens to the demand curve for apples when the price increases?

• It remains unchanged

• It shifts to the right

• It shifts to the left

• It becomes vertical

What is the initial effect on apple demand when its price increases?

• Demand remains constant

• Demand decreases

• Demand becomes elastic

• Demand increases

When the price of apples increases, what do consumers tend to do?

• Substitute apples with bananas

• Buy more expensive fruits

• Stop buying fruits

• Buy more apples

How does the demand curve for bananas change when apple prices rise?

• It shifts to the right

• It becomes steeper

• It shifts to the left

• It remains unchanged

Why do consumers prefer bananas when apple prices increase?

• Bananas become cheaper

• Bananas are healthier

• Bananas are more available

• Bananas have a better taste

What is the result of the demand curve shift for bananas?

• Bananas become more expensive

• No change in quantity demanded

• Decreased quantity demanded

• Increased quantity demanded

What is the effect on the banana market when consumers shift from apples to bananas?

• Supply curve shifts right

• Demand curve shifts right

• Supply curve shifts left

• Demand curve shifts left

What is the next topic to be discussed in the following video?

• Complementary products

• Price elasticity

• Market equilibrium

• Consumer preferences