Economics SA Paper 2 Section B Review

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Define price-inelastic demand

When demand changes by a smaller percentage than the change in price and when PED is less than 1.

Explain two causes of a shift of demand curve to the left.

decrease in the price of a substitute, if a substitute becomes cheaper people will switch to it

Analyse how a government could promote the purchase of merit goods

Subsidise merit good producers, reducing production costs, lowering price, improving quality, making them more affordable

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