# Questions tagged [demand]

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### Interpreting the q-intercept of the demand curve

Given a demand curve for a particular commodity, which I'll interpret as a function $p(q)$, the $p$-intercept can be interpreted as the choke price, i.e. the lowest price at which quantity demanded is ...
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### When the global optimal is outside of the constraint set, what will be the demand?

$u:\mathbb R^n\to\mathbb R$ is a quasi-concave utility function so the indifference curves are convex. $a,b\in\mathbb R^n$ are two points. Our budget set is the (one-dimensional) segment $[a,b]$ that ...
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### Why can't I find masks for the corona virus?

Not an economist by far, just a layman, and that's a layman question. How is this possible that it's difficult to find mask for the Corona Virus? I have been several times to 7/11, boots, Watson, and ...
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### Finding demand functions for an unusual utility function

I have a utility function: $U = x + \min\{x,y\}$ I want to draw the indifference curve and find the demand functions. Will it be the case of the usual perfect complements? Also, what preferences ...
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### What additional axiom to GARP do we need to generate a differentiable or smooth utility function

After researching for a while, I find this: https://www.jstor.org/stable/1913607?seq=2#metadata_info_tab_contents They come up with an axiom called SSARP that generates a preference with smooth demand ...
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### confusion regarding elasticity of a demand curve

The following question is on a quiz at Marginal Revolution University: https://mru.org/practice-questions/calculating-elasticity-demand-practice-questions The elasticity of demand is 2.0. Is the ...
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### Can there be a good which has both Hicksian and Marshallian demand curves vertical?

Consider a perfectly inelastic (Marshallian) demand curve for a good X. Does this good also have a vertical Hicksian demand curve?
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### Increase in the price of skateboard wheels cause a decrease/no change in the demand of skateboards? (2 separate markets w/ 2 separate buyers)

Would an increase in the price of skateboard wheels cause a decrease/no change in the demand of skateboards? (2 separate markets with 2 separate buyers) Note: I'm going to be mainly focused on the ...
44 views

### why is aggregate demand equal to aggregate expenditure?

AD is how much the people in market demand (or want to buy) goods and services. On the other hand, AE is actually how much they end up spending. AD = AE = C+I+G+X-M I can demand and not buy? wouldn'...
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### Why isn't “long-run aggregate demand (or LRAD)” a thing?

To give you a sense of where I am in my understanding of economics, I've just learned about long-run aggregate supply in the neoclassical/monetarist view as a vertical curve. It occurred to me why ...
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### How can I prove $∇U(x).D_m x(p,m)= \text{shadow price}$?

Why inner multiplication of the gradient of utility function in derivative of demand function with respect to income is equal to shadow price? This is the equation which is given but I don't know ...
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### Why income elasticity of demand of luxury good in greater than 1?

According to textbook and wikipedia, "if income elasticity of demand of a commodity is less than 1, it is a necessity good. If the elasticity of demand is greater than 1, it is a luxury good or a ...
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### Unit Elasticity Calculation Question

I'm struggling with a math concept dealing with unit elasticity at an undergraduate textbook level. In most problems, we are given a starting price and an ending price as well as corresponding ...
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### Effects of increased income over short and long run in AD-AS equilibrium model

I've read in a few places that increased income/wages shifts SRAS to the left, which makes sense because firms' costs are increasing to pay for them. My textbook says that there's no effect on ...
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### Aggregated demand of households given utility function

I have an utility function given, $\ u_j(q_{j1},q_{j2} )=q^{3/4}_{1j}*q^{1/4}_{2j}$ $\ s.t.: y=p_1*q_{1i} +p_2*q_{2i}$ I do know that the for $\ q_{1j}$ the marginal prospensity to consume is 3/...
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### Why doesnt Law of Diminishing Marginal Utility not affect price effect?

Ok so in my textbook, it is given that the downward slope of the demand-price curve is justified by three factors: Law of Diminishing Marginal Utility Income Effect(Real income) Substitution effect ...
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### Can the demand curve be a rectangular hyperbola, but $E_D \neq 1$? [closed]

So, I am given the next table: I am asked to find $Q_D$. So the prerequisites to find $Q_D$ is that the price must change, and all other factors of demand must be steady. So, I can find the $Q_D$ ...
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### Effect of a change in quality on price elasticity of demand

I am interested to know how one would expect a change in the quality of a product to affect its price elasticity of demand. Two example will illustrate my confusion: Example 1 Suppose a producer is ...
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### Quasi-linear utility. Deriving demand

I was trying to derive a general demand for the good $x$ for this quasi-linear function $u(x,y) = y + 2\sqrt{x}$ subject to standard budget constraint $p_x x + p_y y \leq M$ Using Kuhn-Tucker ...
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### How do I derive the aggregate demand function given two utilities functions?

Assume that we have two people with the same utility function of $U_i = x^{1/2} + y^{1/2}$ where $i=1,2$ and $I_i$ is the income. Let $P_x$ denote price of good $x$ and $P_y$ denote price of good $y$. ...
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### Derivation of a Demand Equation

A consumer's utility function is $U(x,y)=\sqrt x + y$. Assuming we have an interior solution, I need to show that the demand for $x$ does not depend on income. I know that the consumer consumes where ...
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### On Demand Functions and Engel Curves

A consumer has utility function $U(x,y)=(x−2)y$, where $x≥2$ and $y≥0$. The price of $x$ is $P_x$, the price of $y$ is $P_y$ and the consumer's income is $I>2P_x$. ($x$ and $y$ do not have to be ...
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### How does investment lead to generation of jobs?

I quote from India's Economic Survey 2019 (an official document) - While the claim is often made that investment displaces jobs, this remains true only when viewed within the silo of a specific ...
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### Intermediate demand vs. Intermediate consumption

I am trying to understand what's the difference between intermediate consumption and intermediate demand. The context is the European System of Accounts, which says that intermediate demand is the ...