Application Exercise 3c: Changes in demand
|
Building materials |
Increase |
Because homes need to be built for the increased number of households |
|
Child care services |
Increase |
Because parents will be able to afford to use child care more often |
|
Apples |
Decrease |
Because the price of a substitute has decreased |
|
Butter |
Decrease |
Because the price of a substitute has decreased |
|
Luxury cars |
Increase |
Because household wealth increases and consumers can afford more luxury goods |
|
Home extensions |
Decrease |
Given that most people borrow to undertake extensions, the higher cost of borrowing deters consumers from extending their homes |
|
Motor vehicles |
Decrease |
Because consumers are less confident about the future and are therefore likely to spend less and save more |
|
Electric cars |
Decrease |
Because the cost of owning/running a substiture for electric cars (i.e. petrol cars) is lower which increases the demand for petrol powered cars |
|
Postal services |
Increase |
Because online transactions will usually involve the delivery of parcels |
|
Coffee |
Decrease |
Because the price of a complement for coffee has risen, the overall cost of consuming coffee will increase |
|
Cigarettes |
Decrease |
Because consumers are less likely to be enticed by colourful packaging |
|
Solar panels |
Decrease |
Because the effective or final cost of installing solar panels will rise |
|
Bottled water |
Increase |
Because the price of a substitute (soft drinks) will rise |
|
Uber ride sharing |
Decrease |
Because the availability of a substitute has increased |
|
Guns |
Decrease |
Because the purchase of a greater range of guns is likely to be made illegal to possess |
|
Gas |
Increase |
Because households/businesses will need energy (including gas) to heat homes/buildings |
|
Fish |
Increase |
Because people, on average, prefer to eat healthier food |
|
Petrol |
Decrease |
Because the demand for a complement will fall (ie the demand for cars will decrease) |
|
Education exports |
Decrease |
Because foreign students are not allowed to enter the country |
|
Face masks |
Decrease |
Because the risk of transmitting the disease falls |