Answer to Question #226111 in Microeconomics for Fikile Mbatha

Question

1.1 List the four (4) determinants of demand and the four (4) determinants
of supply mentioned in the extract.

1.2 Explain whether the volatility in the demand for potatoes constitutes a
change in demand or a change in the quantity demanded. Thereafter,
use a graph to explain the difference between a change in demand and
a change in quantity demanded.

Answer 1

1.1

Determinants of demand

• consumer preferences
• Price of related products like compliments
• Price of the product and in this case is the price of Irish potatoes.
• The level of income of the consumer.

Determinants of supply

• The amount of goods produced.
• Price of the product
• Cost of production
• Price of related products

1.2

Votality in the demand for potatoes constitutes a change in quantity demanded.

Change in demand means a shift in demand curve wile change in quantity demanded is a movement along the demand curve which is caused by change in price.