Teori Konsumen 2

Topik
• Price Consumption Curve
• Income Consumption Curve
• Permintaan Individu
• Permintaan Pasar
3.1 Individual Demand
• Price Changes
FIGURE 1
EFFECT OF PRICE
CHANGES
A reduction in the price of
food, with income and the
price of clothing fixed, causes
the consumer to choose a
different market basket.
In panel (a), the baskets that
maximize utility for various
prices of food (point A, $2; B,
$1; D, $0.50) trace out the
price-consumption curve.
Part (b) gives the demand
curve, which relates the price
of food to the quantity
demanded. (Points E, G, and
H correspond to points A, B,
and D, respectively).
The Individual Demand Curve
● price-consumption curve Curve tracing the utility-maximizing
combinations of two goods as the price of one changes.

● individual demand curve Curve relating the quantity of a good that a

single consumer will buy to its price.

The individual demand curve has two important properties:

1. The level of utility that can be attained changes as we move along the
curve.
2. At every point on the demand curve, the consumer is maximizing utility by
satisfying the condition that the marginal rate of substitution (MRS) of food for
clothing equals the ratio of the prices of food and clothing.

Income Changes
● income-consumption curve Curve tracing the utility-maximizing
combinations of two goods as a consumer’s income changes.
FIGURE 2
EFFECT OF INCOME
CHANGES
An increase in income, with the
prices of all goods fixed, causes
consumers to alter their choice of
market baskets.
In part (a), the baskets that
maximize consumer satisfaction for
various incomes (point A, $10; B,
$20; D, $30) trace out the income-
consumption curve.
The shift to the right of the demand
curve in response to the increases in
income is shown in part (b). (Points
E, G, and H correspond to points A,
B, and D, respectively.)
• Normal versus Inferior Goods

FIGURE 3
AN INFERIOR GOOD
An increase in a
person’s income can
lead to less
consumption of one of
the two goods being
purchased.
Here, hamburger,
though a normal good
between A and B,
becomes an inferior
good when the income-
consumption curve
bends backward
between B and C.
• Engel Curves
● Engel curve Curve relating the quantity of a good consumed
to income.

FIGURE 4
ENGLE CURVES
Engel curves relate the
quantity of a good consumed
to income.
In (a), food is a normal good
and the Engel curve is
upward sloping.
In (b), however, hamburger
is a normal good for income
less than $20 per month
and an inferior good for
income greater than $20 per
month.
 Substitutes and Complements
Two goods are substitutes if an increase in the price of one leads
to an increase in the quantity demanded of the other.

Two goods are complements if an increase in the price of one

good leads to a decrease in the quantity demanded of the other.

Two goods are independent if a change in the price of one good

has no effect on the quantity demanded of the other.

The fact that goods can be complements or substitutes suggests

that when studying the effects of price changes in one market, it
may be important to look at the consequences in related
markets.
3.2 Income and Substitution Effects

A fall in the price of a good has two effects:

1. Consumers will tend to buy more of the good that has become
cheaper and less of those goods that are now relatively more
expensive. This response to a change in the relative prices of goods
is called the substitution effect.

2. Because one of the goods is now cheaper, consumers enjoy an

increase in real purchasing power. The change in demand resulting
from this change in real purchasing power is called the income effect.
Substitution Effect

● substitution effect Change in consumption of a good associated with a

change in its price, with the level of utility held constant.

Income Effect

● income effect Change in consumption of a good resulting from an increase

in purchasing power, with relative prices held constant.

In Figure 4.6, the total effect of a change in price is given theoretically by the
sum of the substitution effect and the income effect:

Total Effect (F1F2) = Substitution Effect (F1E) + Income Effect (EF2)

FIGURE 5
INCOME AND SUBSTITUTION
EFFECTS: NORMAL GOOD
A decrease in the price of food has
both an income effect and a
substitution effect.
The consumer is initially at A, on
budget line RS.
When the price of food falls,
consumption increases by F1F2 as the
consumer moves to B.
The substitution effect F1E (associated
with a move from A to D) changes the
relative prices of food and clothing but
keeps real income (satisfaction)
constant.
The income effect EF2 (associated
with a move from D to B) keeps
relative prices constant but increases
purchasing power.
Food is a normal good because the
income effect EF2 is positive.
FIGURE 6
INCOME AND SUBSTITUTION
EFFECTS: INFERIOR GOOD
The consumer is initially at A on
budget line RS.
With a decrease in the price of
food, the consumer moves to B.
The resulting change in food
purchased can be broken down
into a substitution effect, F1E
(associated with a move from A to
D), and an income effect, EF2
(associated with a move from D to
B).
In this case, food is an inferior
good because the income effect is
negative.
However, because the substitution
effect exceeds the income effect,
the decrease in the price of food
leads to an increase in the quantity
of food demanded.
A Special Case: The Giffen Good

● Giffen good Good whose demand curve slopes upward because

the (negative) income effect is larger than the substitution effect.

FIGURE 7
UPWARD-SLOPING DEMAND CURVE:
THE GIFFEN GOOD
When food is an inferior good, and
when the income effect is large
enough to dominate the substitution
effect, the demand curve will be
upward-sloping.
The consumer is initially at point A,
but, after the price of food falls,
moves to B and consumes less
food.
Because the income effect F2F1 is
larger than the substitution effect
EF2, the decrease in the price of
food leads to a lower quantity of
food demanded.
3.3 Market Demand

● market demand curve Curve relating the quantity of a good

that all consumers in a market will buy to its price.

From Individual to Market Demand

TABLE 4.2 DETERMINING THE MARKET DEMAND CURVE

(1) (2) (3) (4) (5)
PRICE INDIVIDUAL A INDIVIDUAL B INDIVIDUAL C MARKET
($) (UNITS) (UNITS) (UNITS) UNITS
1 6 10 16 32
2 4 8 13 25
3 2 6 10 18
4 0 4 7 11
5 0 2 4 6
FIGURE 8
SUMMING TO OBTAIN A
MARKET DEMAND CURVE
The market demand curve is
obtained by summing our
three consumers’ demand
curves DA, DB, and DC.
At each price, the quantity of
coffee demanded by the
market is the sum of the
quantities demanded by
each consumer.
At a price of $4, for example,
the quantity demanded by
the market (11 units) is the
sum of the quantity
demanded by A (no units), B
(4 units), and C (7 units).
Two points should be noted:
1. The market demand curve will shift to the right as more consumers enter
the market.
2. Factors that influence the demands of many consumers will also affect
market demand.

The aggregation of individual demands into market becomes important in

practice when market demands are built up from the demands of different
demographic groups or from consumers located in different areas.