Elementary Theory of Demand — Important Questions

Car and petrol, Printer and ink, Mobile and sim card, Bread and butter

Joint demand occurs when two or more goods are demanded together to satisfy a want. Tea and coffee are substitutes, not complementary goods with joint demand.

Price of the commodity, Consumer's income, Tastes and preferences, Price of related goods

Individual demand is affected by price of the commodity, consumer's income, tastes and preferences, and price of related goods. Population size affects market demand, not individual demand.

True

Giffen goods are highly inferior goods where demand increases when price increases, violating the normal law of demand. This happens because of strong negative income effect.

Substitute goods

Tea and coffee are substitute goods because one can be used in place of the other. When the price of coffee increases, demand for tea increases as consumers substitute tea for coffee.