Demand Wrap-Up

PART 1:

1. UTILITY
- The usefulness that a good or service provides
-A car provides transportation for people to get to work, school, etc.

2. COMPLEMENTARY DEMAND
-If the demand of an object increases, then the demand of an item that is usually bought with it will increase as well.
-If people start buying more cereal, they will start buying more milk.


3. SUBSTITUTE DEMAND
-If an item can easily replace a product that is more expensive, the cheaper product will show an increase in demand.
-If apple juice becomes way to expensive, people may buy more orange juice.

4. ELASTIC DEMAND
-When the price of a product increases and the demand for it decreases due to the price change.
-If chocolate milk were 20 dollars per jug, people would stop buying it.


5. INELASTIC DEMAND
-If the price increases, the demand for a product stays the same because it is irreplaceable.
-Even if cell phones became much more expensive, people would still buy them because they need to communicate with others.


PART 2:
A.

B.

PART 3:
A.

B.