Consider each of the following markets. Determine which "other things equal conditions have changed, and in which direction the demand curve would shift. Is it an increase or decrease in demand?
a) Haircuts: Long hair becomes trendy.
b) Movies in the theatre: The price of video rentals decreases.
c) Snowboards: The price of season passes at Whistler increases.
d) Bus tickets: Consumer income has increased.
e) Vancouver houses: People believe the house price will continue decreasing.
(a) Haircuts : Long hair becomes trendy . Here , the other things is "Consumer preferences ". The demand would haircuts would decreases as long hair becomes trendy. Therefore, demand would shift leftward.
(b) Movies in the theatre : The price of video rentals decreases.Here the other things is "price of related goods i.e substitute goods". Because the price of video rentals decreases, so the demand for movies in the theatre decreases, and therefore demand curve would shift leftward.
(c) Snowboards : The price of season passes at Whistler increases. Here the other things "the price of related goods i.e complement good ". Because the price of season passes at Whistler increases, so the demand for snowboards decreases and therefore , demand curve would shift leftward.
(d) Bus tickets : Consumer income has increased . Here the other things "consumer income". As consumer income increases ,consumer would prefer to go by his/ her own vehicle rather than going by bus , so demand for bus tickets would decrease. And therefore ,demand for bus tickets would shift leftward.
(e) Vancouver houses: People believe the house price will continue decreasing. Here the other things "price expectations in future". Because people believe that house price will continue decreasing , so people would postpone their current demand for buying houses , so the demand would decreases. Therefore, demand for Vancouver houses would shift leftward.
Consider each of the following markets. Determine which "other things equal conditions have changed, and in...