00:02
Hello, so i'm going to answer the question about elements that affect the demand curve for doing so first i write down the elements here and then i show you what will be the potential effect in this graph so in this graph you can see the this is the supply and the mark curve and the vertical axis you will have the price and your horizontal axis the quantities the line is the supply curve which means which have a positive relationship that means that a higher price there will be more companies willing to offer the product and the demand have a negative relationship which means that a higher price there will be more companies willing to offer that product and the demand have a negative relationship which means that a higher price there will be less individuals to pay that price.
00:41
The first thing is change of income.
00:43
So the issue is that with changes of income it's not unilateral but you need to know if the good is normal or inferior.
00:52
If the good is normal which means that a higher income you will consume more.
00:56
When you have higher income this would shift the demand to the right, increasing the prices and the quantities.
01:02
If the good is inferior and increase the higher income, on income will have the same effect that it will increase the prices and the quantities of that good consume and inferior goods the one that you increase when your income decrease the second thing will be preference so preference is let's say people start liking more vegetarian food so that will shift them and to the right like the red line and will increase the quantities and the prices consumed prices of related good let's go with the same example of vegetarian food because vegetarian food became more expensive people could say that it's crazy that i don't know tofu is more expensive so they will shift their consumption from tofu to chickpeas because they are good substitutes so then increasing tofu will make an effect increasing the quantities and prices of chickpeas so in this case the change in tofu will have this same effect of the red line the fourth one will be expectations.
02:06
So let's say you imagine that, like in the covid, the toilet paper was going to be more scarce.
02:13
So then you increase your consumption of toilet paper that will shift the red line, the black to the red line to the right.
02:22
That would mean that there were higher quantities consumed and prices consumers.
02:26
You may recall from the pandemic...