Bahasa Inggris Tugas 1

Text B

Elasticity of supply, as a response to changes in price, is related to demand. economists define 'demand' as a consumer's desire or want, together with his willingness to pay what he wants. we can say that demand is indicated by our willingness to offer money for particular goods or services. Money has no value in itself, but serves as a means of exchange between commodities which do have a value to us. People very seldom have everything they want. Usually we have to decide carefully how we spend our income. When we exercise our choice, we do so according to our personal scale of prefences essential commodities comes first. (food, clothing, shelter, medical expenses, etc) then the kind of luxuries which help us to be comfortable (telephone, special furniture, insurance, etc) and finally those non-essentials which gave us personal pleasure (holidays, parties, visit theathers or concert, choco;ates, etc). They may all seem important, but their true importance can be measured by deciding which we are prepared to live without. Our decisions indicate our scale of preferances and therefore our priorities. Elasticity of demand is a measure of the change in the quantity of a good, in response to demand. The change in demand results from a change in price. Demand is inelastic when a good is regarded as a basic necessity, but particulary elastic for non-essential commodities. Accordingly, we buy basic necessities even if the prices rise steeply, but we buy other things only when they are relatively cheap.

Say whether these sentences are true (T) or false (F), and if they are false say why.

• When people offer money for particular goods, they indicate that a demand exist.  (T)
• Money is usually valuable in itself (F) 

      --> Money has no value in itself, but serves as a means of exchange between    commodities which do have a value to us.

• People do not usually have everything they want (T)
• Basic needs come before luxuries (T)
• Our decisions on how to use our money show what we need most and what we are willing to do without. (T)
• Demand for essential commodities is always elastic (F)

        --> Demand is inelastics when a good is regarded as a basic necessity, but particulary elastic for non-essentials commodities.