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`SENJU EXHIBIT 2234
`INNOPHARMA v SENJU
`IPR2015-00903
`
`

`
`ECON OMICS
`
`Seventeenth Edition
`
`PAUL A. SAM UELSON
`Institute Professor Eme ritus
`Massachuse tts Institute of Te chnology
`WILLIAM D. NORDHAUS
`A. Whitney Griswold Professor of Economics
`Yale University
`
`rg McGraw-Hill
`H
`Irwin
`
`Boston Burr Ridge, IL Dubuque, lA Madison, WI New York San Francisco St. Louis
`Bangkok Bogota Caracas Kuala Lumpur Lisbon London Madrid Mexico City
`Milan Montreal New Delhi Santiago Seoul Singapore Sydney Taipei Toronto
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`TH E DEMAND Cl 'RVE
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`49
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`cuswmers through che substitution effect. In addition,
`a price reduction will induce extra pLLrchases of goods
`by existing consumers through both the income and
`che substitution effects. Conversely, a rise in the price
`of a good will cause some of us to buy less.
`
`The e xplosive growth
`in com pute r demand
`We can illustrate the law of downward-slop(cid:173)
`Ing demand lor the case of personal com-
`puters (PCs). The prices of the first PCs were
`high. and their ~omputing power was relatively
`modest. They were found in few businesses and even
`fewer homes. It is hard co believe that just 20 years ago
`student.s wrote most o f their papers in longhand and did
`most calculations by hand or wit h s1mple calculatOr'S.
`But the prices of computing power fell sharply over
`che lase cwo decades. As the prices fell. new buyers were
`enticed to buy th eir first computers. PCs came ro be widely
`used for work, for school, and for fun. In the lace 1990s.
`as the value of computers increased with th e development
`of the Internee. yet more people jumped o n the computer
`b~rldwagon. Worldwide. PC sal~s totaled about 100 mrl(cid:173)
`lion in 1999.
`Figure 3-3 shows the prices and quantities of com(cid:173)
`puters and peripheral equipment in the United Scates as
`cakuloted by government statiSticians. The prices reilect
`the cost of purchasing computers with constant quality(cid:173)
`that Is, they cake into account the rapid quality change of
`the average computer purchased. You can see how falling
`prices along w1th improved software. increased utility of
`the lncernet and e-mail. and o cher factors have led to an
`explosive growth in computer oucpuc.
`
`Forces behind the Demand Curve
`·what determines the marke t demand curve for corn(cid:173)
`flakes or gasoline o r computer~?.-\ whole array of fac·
`tors influences how much will be demanded at a
`given price: average levels of income, •he size of the
`population, the p rices and availability of related
`goods, ind ividual and sociaJ tastes, and sp<!cial in(cid:173)
`fluences.
`
`• The averagr mcorr!l of consumers is a key de termi(cid:173)
`nant of demand. As people 's incomes nse, incti-
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`viduals tend to buy more of almost everything, even
`if prices don't change. Amomobile purchases tend
`to rise sharply with higher levels of income.
`• T he fize of the market-measured. say, by the po p(cid:173)
`ulation- clearly affects
`the market demand
`curve. California's 32 million people tend to buy
`32 times more apples and cars than do Rhode Is(cid:173)
`land's I million people.
`• The prices a nd availability of related goods influ(cid:173)
`e nce the demand for a commodity. A pa rticu(cid:173)
`larly important connection exists among s ub(cid:173)
`stitute goods-ones that te nd to perfo rm the
`same fu ncuon, such as cornfla kes a nd oatmeal,
`pens a nd pe ncils, sma ll cars and large cars, o r
`oil and na tural gas. De ma nd fo r good A tends
`to be low if the price o f substitu te p roduc t B is
`low. (For exa mple , if the p rice ·of comp uters
`fal ls, wi ll that increase or decrease the demand
`fo r rypewriters?)
`• [n add itio n to these objec tive eleme n ts. the re
`is a set of subjective eleme n ts called tastes or
`preferem;es. Tastes represenc a variety of culrural
`and historical influences. They may reflect gen(cid:173)
`uine psychological or physiological needs (for
`liquids, love, or excnemenc). And they may in(cid:173)
`clude artificially contrived cravings (for ciga(cid:173)
`rettes, drugs. or fancy sports cars). They may
`also con tain a large element of tradition o r re(cid:173)
`ligion 1 <!ating beef is popular tn America but
`taboo in India, while curried jellyfish is a deli(cid:173)
`cacy in Japan but would make many .\mericans
`gag).
`• Finally, sped.ai influences will affect the demand for
`pa rticular goods. The demand for umbrellas is
`hig h in rainy Seattle but low in sunny Phoe nix;
`the demand for air conditio ners will rise in hot
`weather; the demand fo r automobiles will be low
`in New York, where p ublic u anspo rtation is plen(cid:173)
`tiful and pa rking is a nightmare. ln addition, ex(cid:173)
`pectations about future economic conditions,
`pan.icular!v p rices, may have an important im(cid:173)
`pact o n demand.
`
`The dete rminants of demand are .mmmarized in
`Table 3-2. which uses automobiles as an example.
`
`Shifts in Demand
`As economic life evolves, demand changes inces(cid:173)
`santly. Demand curve3 3it 3till only in textbooks.