Class Lecture #28 - 11/7

This lecture focused on demand curves and how they can shift to the left and right and how you can move up and down along a curve (quantity demand).
Demand: willingness and ability to consume

MARKET Demand
- As the prices decrease, the quantity demand increases and vice versa
      = movement along curve
- The shape of a demand curve is different for every individual
- Is it possible to aggregate multiple curves into one super curve?
      --> curve gets flatter as we aggregate further
      --> hard to aggregate beyond a single good

Comparative Statics.... What changes people's consumption of a good?
- own price
- everything else:
      1. Income        2. Substitutes       3. Expectations        4. Tastes         5. # of individuals
   (income and substitutes = ability, expectations, tastes, # = willingness)
Income (NOT PRICES!)
- Normal goods = income goes up, quantity demand goes up
- Inferior goods = income goes up, quantity demand goes down
preferences subjective for everyone
Prices of Other Goods
- Substitutes: Q moves in same direction as price change
- Complements: Q moves in opposite direction as price change