Prepare a survey asking people how much of a product (like a cold drink, etc.) they would buy at different prices. Create an individual and market demand schedule, and plot a demand curve using the data.
Answer (2)
To analyze how much of a cold drink people would buy at different prices, create a survey and construct individual and market demand schedules based on the responses. Plot these results on a graph to illustrate the demand curve. This exercise helps understand consumer behavior and price sensitivity.
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To prepare a survey asking people how much of a product like a cold drink they would buy at different prices, follow these steps:
Design the Survey Questions:
Determine the product you are interested in studying, for example, a cold drink.
Create questions asking respondents how many units they would buy at different price points. For instance:
How many cold drinks would you purchase at $1.00 each?
How many cold drinks would you purchase at $1.50 each?
Continue this up to a reasonable price increment, such as $3.00.
Conduct the Survey:
Distribute the survey to a sample group of individuals that represents your target market. This can be done online, in-person, or over the phone.
Collect and Organize Data:
Gather responses and organize them in a table, noting the quantity demanded at each price level.
Create Individual Demand Schedules:
For each respondent, make a list (schedule) of prices and the corresponding quantity they would buy.
Create a Market Demand Schedule:
Sum the quantities from all individual demand schedules at each price point to create a market demand schedule.Price (USD)Quantity Demanded (Market)1.001001.50802.00602.50403.0020
Plot a Demand Curve:
Use the market demand schedule to plot a demand curve. The price should be on the vertical axis (y-axis), and the quantity demanded should be on the horizontal axis (x-axis).
The curve typically slopes downwards from left to right, illustrating the law of demand: as the price of a product decreases, the quantity demanded generally increases.
This step-by-step approach provides a clear method for understanding how consumer demand varies with price changes, an essential concept in business economics.
