中级微观经济学——理论与应用（第10版）（经济学经典教材·双语教学用书） 教学课件 ppt 作者 尼克尔森等 著 0324319681_67666

Chapter 4,Market Demand And Elasticity,© 2006 Thomson Learning/South-Western,2,Market Demand Curves,Market demand: total quantity of good or service demanded by all potential buyers. Market demand curve shows relationship between the total quantity demanded of a single good or service and its price, holding all other factors constant.,3,Constructing the Market Demand Curve,We construct a market demand curve (D) by horizontally summing the all individual consumers demand for the good or service. Fig. 4-1: Assume market consists of only two buyers At any given price, such as P*X, individual 1 demands X*1 and individual 2 demands X*2.,4,(a) Individual 1,PX,X,P*,X*,1,0,FIGURE 4-1: Constructing a Market Demand Curve from Individual Demand Curves,5,(a) Individual 1,PX,X,P*,X*,1,0,(b) Individual 2,X*,2,0,FIGURE 4-1: Constructing a Market Demand Curve from Individual Demand Curves,PX,Area AEB the consumer surplus area in Figure 3-11.,6,(a) Individual 1,PX,X,P*,X*,1,0,(b) Individual 2,X*,2,0,(c) Market Demand,X,D,X*,0,FIGURE 4-1: Constructing Market Demand Curve from Individual Demand Curves,PX,PX,7,Construction of Market Demand Curve,The total QX demanded at market P*X is sum of two amounts: X* = X*1 + X*2 . Point X*, P*X provides one point on market demand curve. Other points on D curve similarly plotted based on all QX demanded at other PX.,8,Shifts in Market Demand Curve: Income,An increase in income for each consumer would shift their individual demand curves out so that the market demand curve would also shift out from the origin. Shown in Figure 4-2,9,(a) Individual 1,PX,X,P*,X*,1,0,(b) Individual 2,X*,2,0,(c) Market Demand,X,D,X*,0,FIGURE 4-2: Increases in Each Individuals Income: Market Demand Curve Shifts Outward,PX,PX,X*,X*,X*,D,1,2,10,Shifts in Market Demand Curve: Income,Some events result in ambiguous demand curve outcomes: If one consumers demand curve shifts out while anothers shifts in, the net effect depends on the size of the relative shifts. Income increases for pizza lovers would increase market demand for pizza, so long as pizza is normal good.,11,Shifts in Market Demand Curve: Income,If only people who dont like pizza enjoyed income increases, the market demand curve for pizza would not change. Changes in prices of related goods- substitutes or complements-will also shift individual and market demand curves.,12,Shifts in Market Demand Curve: Related Goods,If goods X and Y are substitutes, an increase in PY will increase DX. Similarly, a decrease in PY will decrease DX. If goods X and Y are complements, an increase in PY will decrease DX. A decrease in PY will increase DX.,13,Elasticity,Elasticity: measures percentage change in one variable brought about by a 1 percent change in some other variable. Because its measured in percentages, units cancel out- elasticity is a unit-less measure of responsiveness.,14,Price Elasticity of Demand,Price elasticity of demand: percentage change in quantity of a good demanded in response to a 1 percent change in its price,15,Price Elasticity of Demand,Price elasticity of demand records how QX changes (in percentage terms) given a percentage change in PX. On typical demand curve, P and Q move oppositely: eQ,P will be negative. For example, if eQ,P = -2, a 1 percent increase in price leads to a 2 percent decrease in quantity demanded.,16,TABLE 4.1: Terminology for the Ranges of eQ,P,17,Price Elasticity: Substitutes Effect,Goods that have many close substitutes are strongly affected by price changes, so their market demand curve is likely to be relatively elastic (flat). Goods with few close substitutes will likely be relatively inelastic (demand curve will be more steep).,18,Price Elasticity and the Substitution Effect,There is also an income effect that will determine how responsive quantity demanded is to changes in price. However, since changes in the prices of most goods have a small effect on individuals real incomes, the income effect will likely not have as large an impact on elasticity as the substitution effect.,19,Price Elasticity and Time,For some items, substitutes can be quickly developed-such as brands of breakfast cereal. Other goods, such as heating fuel, are much less subject to being copied. We must thus make the distinction between short-term and long-term price elasticities of demand.,20,Price Elasticity and Total Expenditures,Total expenditures on a good are found by multiplying the goods price (PX) times the quantity purchased (QX). When demand is price elastic, price increases will cause total expenditures to fall. Given percentage increase in price more than counterbalanced by decrease in quantity demanded.,21,Price Elasticity and Total Expenditures,Suppose price elasticity of demand = -2. Initially people buy 1 million automobiles at $10,000 each- total expenditure of $10 billion. 10% price increase to $11,000 would cause 20 percent decline in cars purchased to 800,000 vehicles. T