Describe how each of the following will affect the demand for personal computers: (a) A rise in incomes (assuming computers are a normal good); (b) A lower expected price for computers; (c) Cheaper software; (d) Simpler-to-operate computers.

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Answer and Explanation:

The impact of the demand in the following situations are

1. Since there is a rise in the income and we assume it is a normal good. So in the case of the normal goods it shows a direct relationship between the income and the demand that means if the income is increased so the demand also increased & vice versa

2. For The lower expected computer price, the demand would decrease as the people predict that the price could decline in future

3. For cheaper software, the demand is increased as the price is very less

4. In the case when the computer are simple to operate so it would increase the demand

A rise in income would lead to an increase in the demand for personal computers.

A lower than expected price for personal computers would lead to a rise in the quantity demanded for  personal computers.

A cheaper software would lead to  an increase in the demand for personal computers.

Simpler-to-operate computers would lead to an increase in the demand for personal computers.

A normal good is a good whose demand increases when income increases and decreases when income declines.

Only a change in the price of a good leads to a change in the quantity demanded. Other factors lead to a change in demand.

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