Question

4.3 assessment
think critically

1. what would happen to the demand curve for bus tickets if the price of gasoline doubled? which of the determinants of demand would this affect?
2. what would happen to the demand curve for a particular brand of shampoo if a famous movie actress with beautiful hair announces that it is the best shampoo she has ever used? which of the determinants of demand would this affect?
3. what would happen to the demand curve for towels today if a large store announces a 50 - per - cent - off sale on towels next week? which of the determinants of demand would this affect?
4. why might the demand for quick oats that cook in 25 minutes be greater than the demand for regular oats that take 10 minutes?

demand curve for running shoes

Explanation:

1. When gasoline prices double, the cost of driving to buy bus tickets (or using personal transport instead of buses) rises. This makes bus travel a more cost-effective alternative, shifting the bus ticket demand curve right. The affected determinant is price of related goods (substitutes).
2. A famous movie star endorsing a shampoo builds positive brand association and consumer preference. This increases demand for the shampoo, shifting its demand curve right. The affected determinant is tastes and preferences.
3. Consumers will delay towel purchases to take advantage of the upcoming sale, reducing current demand. This shifts today's towel demand curve left. The affected determinant is expectations of future prices.
4. Quick oats save time for consumers with busy schedules, so they are more desirable to time-sensitive buyers. Regular oats take longer to prepare, so demand for them is lower among this group. The key factor is consumer preferences for convenience/time efficiency.

Answer:

1. The demand curve for bus tickets would shift to the right (increase in demand). This is affected by the price of related goods (substitute goods) (gasoline and bus travel are substitutes for personal transport).
2. The demand curve for the shampoo would shift to the right (increase in demand). This is affected by tastes and preferences (the celebrity endorsement changes consumer preferences for the product).
3. The demand curve for towels today would shift to the left (decrease in demand). This is affected by expectations of future prices (consumers expect lower prices next week, so they delay purchases).
4. Demand for quick oats is greater because they appeal to consumers with time constraints, as they offer convenience and time savings compared to the longer preparation time of regular oats. This is driven by consumer preferences for convenience.