The price of a good such as a shirt is determined determined by the interaction of buyers and sellers in the marketplace 8
Do You Demand It likely buy the less expensive option the replacement Complements Complements are goods and services that go together such as peanut butter and jelly When making a purchase buyers may consider both the price of an item and its complement INDIVIDUAL BUYERS AND BUDGETS to Buyers often examine their budgets determine if they can afford a purchase purchase A budget is a plan that includes income and expenses Income is money a person receives such as wages and interest on bank accounts are costs They consist of the money the person spends such as to buy food or cars or to pay rent Expenses A buyer’s budget determines the quantity of the goods and services they Buyers must examine their budgets before making a purchase If a person’s income decreases he or she has less money to spend 9
Do You Prefer It Preference is a big factor of demand Buyers may prefer prefer a good or service even if it costs more money or takes longer to receive the item Different things determine determine a person’s preferences or tastes They may have a favorite ice cream flavor or restaurant Maybe there is a brand of electronics electronics or clothing that they prefer Other people can also influence buyers preferences Companies may hire famous people such as actors and musicians musicians to endorse their products This type of advertising campaign is based on several ideas people want to be like celebrities consumers are more likely to remember remember an ad with a famous The fidget spinner a toy fad has a middle part with two or three protruding protruding paddle-shaped blades to spin 10 Buyers and Sellers
Do You Demand It person and buyers will think a product endorsed by a famous person is of higher quality Peers can also influence a buyer’s decision process People can pressure their friends into buying things they may not have otherwise bought For example two friends in a group may buy the same cell phone Then they may pressure the rest of their group to buy the same phone so that they all have the same chat platform Peer pressure is particularly popular regarding fads or the latest desirable trends Some 2017 fads included fidget spinners slime and Snapchat purchase Budgets often include short-term and long-term financial goals Short-term goals are achieved over short periods of time such as six months Long-term goals take more time to reach such as five or more years Buying a 15 T-shirt is a short-term goal while paying off student loans from college is a long-term goal Budgets can also list intermediate intermediate goals achieved in time frames like two years Some buyers view something like buying a computer as an intermediate intermediate goal Budget expenses can be fixed or variable Fixed expenses like rent or mortgage payments are the same 11
