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Introduction 4 Introduction 4

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The Individual Demand Schedule 6 The Individual Demand Schedule 6

The Individual Demand Curve 7 The Individual Demand Curve 7

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The Law of Demand 9 The Law of Demand 9

Foundations for the Law of Demand 10 Foundations for the Law of Demand 10

The Market Demand Curve 11 The Market Demand Curve 11

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Demand Marginal Utility 13 Demand Marginal Utility 13

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Section Assessment 16 Section Assessment 16

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Section Close 22 Section Close 22

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Study Guide 24 Study Guide 24

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Introduction 27 Introduction 27

Change in Quantity Demanded 28 Change in Quantity Demanded 28

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The Income Effect 30 The Income Effect 30

The Substitution Effect 31 The Substitution Effect 31

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Change in Demand 33 Change in Demand 33

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Consumer Income 36 Consumer Income 36

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Consumer Tastes 38 Consumer Tastes 38

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Substitutes 40 Substitutes 40

Complements 41 Complements 41

Change in Expectations 42 Change in Expectations 42

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Number of Consumers 44 Number of Consumers 44

Section Assessment 45 Section Assessment 45

Section Assessment 46 Section Assessment 46

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Section Close 50 Section Close 50

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Study Guide 52 Study Guide 52

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Introduction 55 Introduction 55

Demand Elasticity 56 Demand Elasticity 56

Elastic Demand 57 Elastic Demand 57

Inelastic Demand 58 Inelastic Demand 58

Unit Elastic Demand 59 Unit Elastic Demand 59

The Total Expenditures Test 60 The Total Expenditures Test 60

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Determining Total Expenditures 62 Determining Total Expenditures 62

Three Results 63 Three Results 63

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Elasticity and Profits 65 Elasticity and Profits 65

Determinants of Demand Elasticity 66 Determinants of Demand Elasticity 66

Can the Purchase Be Delayed? 67 Can the Purchase Be Delayed? 67

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Are Adequate Substitutes Available? 69 Are Adequate Substitutes Available? 69

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Does the Purchase Use a Large Portion of Income? 71 Does the Purchase Use a Large Portion of Income? 71

Section Assessment 72 Section Assessment 72

Section Assessment 73 Section Assessment 73

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Section Close 77 Section Close 77

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Section 1: What Is Demand? 79 Section 1: What Is Demand? 79

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Section 2: Factors Affecting Demand 81 Section 2: Factors Affecting Demand 81

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Section 3: Elasticity of Demand 83 Section 3: Elasticity of Demand 83

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Identifying Key Terms 86 Identifying Key Terms 86

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Reviewing the Facts 89 Reviewing the Facts 89

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Thinking Critically 95 Thinking Critically 95

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Applying Economic Skills 97 Applying Economic Skills 97

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Holding the Fries “At the Border” 113 Holding the Fries “At the Border” 113

Holding the Fries “At the Border” 114 Holding the Fries “At the Border” 114

Holding the Fries “At the Border” 115 Holding the Fries “At the Border” 115

Holding the Fries “At the Border” 116 Holding the Fries “At the Border” 116

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Click inside this box to play the preview. 125 Click inside this box to play the preview. 125

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Understanding Cause and Effect 127 Understanding Cause and Effect 127

Understanding Cause and Effect 128 Understanding Cause and Effect 128

Understanding Cause and Effect 129 Understanding Cause and Effect 129

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