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I need an example of a time when behavior changes in response to changes in price....

I need an example of a time when behavior changes in response to changes in price. It needs to include what market forces caused the price change (i.e. was it a market demand effect, if so what type?). I also need this behavioral change shown by a graph.

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Answer #1

Behavior is changed when the price is changed. For an example, if the price of substitutes increased people's demand is decreased. Suppose the cost movie ticket is increased then people want to watch a movie in the home instead of going to the costly movie theatre. That is demand for DVD will be increased. Another example if the price of tea is increased people want to substitute it with coffee which is cheaper than tea now. That is demand for tea will be decreased.

Here in this above graph demand is increased due to increase in the price of substitution goods. Demand curve shifts to the right from AD1 to AD2. as a result price is increased to P2 and quantity is increased to q2.

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