00:01
Okay, so we're going to basically look at how the demand response, the demand of apples, in each of the five scenarios that are given.
00:12
So we're going to make use of sketch diagrams to illustrate the effect.
00:16
So in the first diagram, we have the relationship between apples and peanut butter, such that peanut butter is a complement.
00:26
So what happens to the demand of apples if the price of peanut butter increases? so this is shown by a negative shift of the demand curve from d -o to d -1, essentially because now if there's a complement, there's going to be a reduction in demand because the price of complementary good has increased.
00:48
And the second incident is when consumer incomes increase and apples are deemed to be.
00:56
Normal goods.
00:58
So the increase in consumer incomes will result in an increase in the demand.
01:04
So there's going to be a positive shift in demand from the o to d1.
01:09
And so that's basically the reaction there.
01:13
And the third scenario, it is confirmed scientifically that in april the day does keep the doctor away.
01:20
So obviously this is something that would encourage consumers to buy more at every price level so the demand is likely to increase.
01:30
It's going to be a positive shifting demand from d -o to d -1 in this particular instance.
01:36
And we look at the fourth scenario that is given.
01:40
Always need to level all the x's here.
01:44
The fourth scenario that is given, the price of april's decreases.
01:49
Now the price of april's decreasing does not shift the demand curve...