Question
An example of a variable that shifts its demand curve for me was just several months ago, and I received higher bills than usual. A
An example of a variable that shifts its demand curve for me was just several months ago, and I received higher bills than usual. A service that I use frequently is my monthly Electric Bill. The price of the Electric Bill increased its costs due to the pandemic was still in effect in Hawaii, ranging between 10% and 15% of my original cost during the previous months. Not to mention it's summer right now, so with extreme temperature in my location, electricity increases the demand for weather conditions such as cooling. Honestly, I decrease my energy consumption since I have a 12-hour shift almost every day at work and only go home to relax and sleep, but with inflation, I have no control over it.
One variable that shifts the electricity's supply curve is the increase in fuel price, which has significantly increased my bill. For example, my bill last month was reading 15,354 versus my account this month at 15,589. That 235 increase in kWh usage shifts the supply curve to the right. Additionally, since there is high electricity, consumers will substitute electricity with solar panels, which is more cost savings than regular electricity, not forgetting the environmental impact.
QUESTION:
A change in a person's income surely affects the demand for almost all goods and services. However, the direction of this affect depends on whether this good/service is normal or inferior. How are each of them different?
Suppose you are a seller of a good and you find out that the average income in the area where you sell your good went down (maybe due to COVID, for example). Would this news make you optimistic and imply higher sales of your good if you are producing a normal or an inferior good and why?
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