Question

A new tool manufacturer opened a plant in town three months ago and hired 3000 new employees. People now have extra cash to spend and are out spending in the town. What is an example of how this extra money may shift the demand curve for goods and services in the town

Answer 1

the extra money causes a 50% increase in IPhone sales.

Step-by-step explanation:

One example would be that the extra money causes a 50% increase in IPhone sales. Therefore this higher income is shifting the demand curve for IPhones upwards due to the number of individuals purchasing the product. If individuals come into more money than they need to survive it is usually spent on luxury goods/services. This creates a demand for these goods and services that did not exist at the same level previously. This increased demand is what curves the demand curve upwards.