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Booms / dips in economic growth can occur due to a number of reasons: 1. REAL WORLD EXAMPLES  Lets take a look at some real world examples. Example 2. Find three REAL world examples of change in demand (shift in demand) or change in supply (shift in supply) or both.. Although examiners are obviously keen that you understand the basics, what they really want to see is whether a candidate has the ability to apply the basics to real world contexts. Example 3: Causes of Economic Growth. Supply and Demand in Everyday Life At the Movies? In this Learn-It, I shall go through a few of the old classics, but examiners are continually coming up with different situations. Mention WHEN and WHERE it happened and what were the consequences (i.e. Example 1 - Movements along and shifts of a demand curve. Figure 1 Demand curve. So far, we have covered the nuts and bolts required to start analysing. Now, the demand function of commodity x is p x = 6 – 0.8 q x. Copy this onto another piece of paper, then sketch on this new diagram the effect of the following changes. The demand curves of commodities x and y are given by P x = 6- 0,8q x and P y = 6 – 0.4q y respectively. Increase in aggregate demand caused by: An increase in consumption – this may be caused by: a rise in income levels, an decrease in interest rates, house price inflation Show that at any given price, the two curves have the same elasticity of demand. The diagram below, Figure 1, represents the demand for a product at a point in time. The price then was P*. When either demand or supply changes, however, the equilibrium price and quantity will also change. Oil rises slightly on hopes for COVID-19 vaccine, declining U.S. crude stocks Consumer demand and income Engel curves An Engel curve describes how household expenditure on a particular good or service varies with household income. A change in demand is the sum of all the changes in quantities demanded that consumers can buy at a specified price level. Let’s look at an example. Therefore, a change in demand is the result of some other factor than price. This results in a change in consumer tastes and preferences in a negative manner that decreases demand (shifts it left). As you read the articles, be thinking about our questions to consider. You then have the opportunity to demonstrate your understanding of supply and demand shifts as you explain the changes in price and quantity experienced by … A basic supply and Solution: We know elasticity of demand . For colleges, the supply would be the amount of seats in a class or housing available for students, while the demand is the prerequisites required to get into that college, such as GPA, cost, and SAT/ACT scores. 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