Name: Class Period: Date: - GOVERNMENT & ECONOMICS

Name: _____________________________ Class Period: _____ Date: _______________

Normal and Inferior Goods Worksheet 4.11.1 You now have $1 million!

What will you do? What will you buy? What will you no longer buy? Your job is to find out. Look on the internet and find goods that you will buy and think of some that you will no longer buy. Place them all into the chart below. You must spend all $1 million. Categorize each good or service, and place an "X" in the Normal or Inferior columns. Add together ONLY the money spent on Normal goods for your final total. You will work on the last column in Module 12.

Good or Service

Price

Normal Inferior Luxury or Necessity

Total Spent=

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Explorations in Economics

?2014 BFW/Worth Publishers

Name: _____________________________ Class Period: _____ Date: _______________

Complements and Substitutes Organizer 4.11.2

Two scenarios are given below that include both substitutes and complements. Place each of the items below the scenarios into one of the two columns as either a substitute (an item that takes the place of the other) or a complement (an item that goes along with that item). Feel free to add to the list if you have others that you believe are a substitute or complement.

Scenario 1 The price of hot dogs drops by $1 per package.

Hot Dog Buns Bratwurst Ketchup Mustard Relish Hamburgers Chili

Scenario 2 The average price of laptop computers rises by $300.

Video Games Laptop Cooling Fans Tablet Computers Flat Panel Displays Desktop Computers Carrying Cases Virus Protection Software

Substitute

Complement

Substitute

Complement

1. What will happen to the demand for the hot dog substitutes?

2. Why?

3. What will happen to the demand for the laptop complements?

4. Why?

5. What will happen to the demand for hot dog complements?

6. Why?

Chapter 4: The Demand for Goods and Services

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Name: _____________________________ Class Period: _____ Date: _______________

Complements and Substitutes Organizer 4.11.2

ANSWER KEY

Two scenarios are given below that include both substitutes and complements. Place each of the items below the scenarios into one of the two columns as either a substitute (an item that takes the place of the other) or a complement (an item that goes along with that item). Feel free to add to the list if you have others that you believe are a substitute or complement.

Scenario 1 The price of hot dogs drops by $1 per package.

Scenario 2 The average price of laptop computers rises by $300.

Hot Dog Buns Bratwurst Ketchup Mustard Relish Hamburgers Chili

Video Games Laptop Cooling Fans Tablet Computers Flat Panel Displays Desktop Computers Carrying Cases Virus Protection Software

Substitute Bratwurst

Hamburgers

Complement Hot dog buns

Ketchup Mustard Relish

Chili

Substitute

Complement

Video games

Laptop cooling

fans

Tablet computers

Flat panel displays

Desktop computers

Carrying cases

Virus protection

software

1. What will happen to the demand for the hot dog substitutes? It will decline, moving the curve to the left.

2. Why? The quantity demanded for hot dogs will rise due to the fall in price, causing the demand for all substitutes to decline moving the curve to the left.

3. What will happen to the demand for the laptop complements? It will decline, moving the curve to the left.

4. Why? The quantity demanded for the laptops will decline due to the increase in price, therefore causing the demand for complementary products to also decline or move the demand curve to the left.

5. What will happen to the demand for hot dog complements? It will increase, moving the curve to the right.

6. Why? A hot dog needs a bun, or ketchup, or mustard, and therefore more hot dogs require more of its complements as well.

46

Explorations in Economics

?2014 BFW/Worth Publishers

Name: _____________________________ Class Period: _____ Date: _______________

Demand Curve Shift Worksheet 4.11.3

Complete the chart by indicating what happens to the demand for Good A when the factors of demand change as described.

Factors for a shift in the demand curve

1. Changes in the price of a related good or service

? If Good A and Good B are substitutes...

? If Good A and Good B are complements...

2. Changes in income ? If Good A is a normal good... ? If Good A is an inferior good

3. Changes in tastes

4. Changes in expectations

5. If Good A is a normal good...

6. If Good A is an inferior good...

7. Changes in the number of consumers

Scenario

and the price of Good B rises... and the price of Good B falls... and the price of Good B rises... and the price of Good B falls...

and income rises... and income falls... and income rises... and income falls...

if tastes change in favor of Good A... if tastes change against Good A ... if the price of Good A is expected to rise in the future... if the price of Good A is expected to fall in the future... and income is expected to rise in the future... and income is expected to fall in the future... and income is expected to rise in the future... and income is expected to fall in the future... if the number of consumers of Good A rises... if the number of consumers of Good A falls...

Indicate if the demand for A increases () or decreases ()

Chapter 4: The Demand for Goods and Services

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