Index
The Demand Curve 1
The Demand Curve 2
The Demand Curve 3
The Laws of Supply and Demand - 4
The Laws of Supply and Demand - 5
A ''Contraction'' of Demand - 6
''Ceteris Paribus'' - 7
An ''Expansion'' of Demand - 8
Marginal Utility - 9
Marginal Utility - 10
Marginal Utility - 11
Marginal Utility - 12
Consumer Surplus - 13
Consumer Surplus - 14
Price Discrimination - 15
An ''Expansion'' of Supply - 16
An ''Expansion'' of Supply - 17
Market Equilibrium - 18
Market Equilibrium - 19
Market Equilibrium - 20
Movements of the Demand Curve - 21
Movements of the Demand Curve - 22
Movements of the Demand Curve - 23
Inferior Goods - 24
Movements of the Demand Curve - 25
Movements of the Supply Curve - 26
Movements of the Supply Curve - 27
Movements of the Supply Curve - 28
The Income Effect - 29
The Substitution Effect - 30
The Substitution Effect - 31
The Substitution Effect - 32
The Substitution Effect - 33
Complements - 34
Complements - 35
Review: Factors Effecting Demand - 36
Review: Factors Effecting Demand - 37
The Goals of Firms - 38
The Goals of Firms - 39
To: Elasticity

Movements of the Demand Curve - 22

Demand can increase for a variety of reasons. Demand for good A can increase if the price of its substitute, B rises. If the price of beef rises, people will buy more lamb, or fish. Demand for a good will increase if the price of its complement falls. Let's say you are looking for a new bicycle, and you notice that one store has the one you want on ''special'' : $50 off the usual price. You will probably buy a better qualiy, (and more expensive) helmet, or repair kit, or some other item that is associated with cycling. After all, you had budgeted for the bicycle : you had a fixed amount of money you wanted to spend. A fall in the price of the bicycle left you with some spare cash.

Demand for many products is seasonal - what we wear and what we eat varies from winter to summer, for example.

Demand will increase or decrease if the size of the population, its composition or its age distribution changes. Australia in 1999 is vastly different from Australia in 1945. In 1945, Australia had a population of 7 million people - mostly of U.K. or Irish background. In 1999, Australia is a multicultural society of 18 million people. And this population is more in contact with global trends than any other generation before it. The growth of telecommunications and computer science will continue to change Australia, just as surely as migrants from Europe changed what we ate, a generation ago.