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| n |
The
most important factor is price, the more
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expensive
it is to buy dentistry all other factors
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remaining
constant the less we will buy.
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– |
If
price rises then the relative price changes, dentistry is
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now
more expensive compared to other goods and
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services.
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| n |
Economists
assume that people are satisfaction
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maximizers. This means that we all try to gain as
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much
satisfaction as possible from our consumption
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of goods and
services. So we react to the fact that
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dentistry is
now relatively more expensive by
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choosing to
buy less of it and more of something else
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instead (substitution effect).
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