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A rise in income leads consumers to buy
more of a product, as they have more money to
spend. This can be seen from figure 2. Fig.2 Thus,
we can see that, when income rises, demand shifts
to D1, and since S curve remains the same, the
price of beer goes up to 2.00. The other factor
that influences demand for beer, could be the
change in consumer tastes and preferences...
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The other factor
that influences demand for beer, could be the
change in consumer tastes and preferences. Some
industries like clothing and furniture are more
affected by it than the others. However, in beer
market it also has a great effect. It can go out of
fashion if consumers believe that, it is more
fashionable to drinks spirits or not to drink at all,
and vice versa consumers might decide that beer is
more fashionable than spirits...
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