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Suppose the demand for what you "sell" rises relative to the supply of what you sell.
a. How would you know demand has increased? (What is the first piece of information which would lead you to conclude that demand has increased?)
b. What is the first thing you would do in response to the change in this market signal?
c. What might be the second thing you would do and why?
d. What may be the benefit or danger connected with the choice you made in (c) and how could you decrease the "danger" and increase the "benefit?"
P stands for price Pr stands for price of related good also N stands for per capita disposable income.
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