kysyntävaikutukset

Kysyntävaikutukset, or demand effects, refer to the changes in the quantity demanded of a good or service as a result of changes in its price. These effects can be categorized into two main types: income effects and substitution effects.

Income effect occurs when a change in the price of a good leads to a change in the consumer's real income. For example, if the price of a good increases, the consumer may have to reduce their consumption of other goods to maintain the same standard of living, leading to a decrease in demand for the good. Conversely, if the price decreases, the consumer may be able to afford more of the good, increasing demand.

Substitution effect, on the other hand, occurs when a change in the price of a good leads to a change in the consumer's choice between this good and other goods. If the price of a good increases, consumers may substitute it with cheaper alternatives, leading to a decrease in demand. Conversely, if the price decreases, consumers may choose to consume more of the good, increasing demand.

The total demand effect is the sum of the income effect and the substitution effect. The relative importance of these two effects depends on the good's income elasticity and cross-price elasticity. For normal goods, the substitution effect is typically more important, while for inferior goods, the income effect is more important.