England’s lockdown in 2020 restrictions only permitted people to meet with one other person from another household in public outdoor spaces. Households prepared for having to socialize in their gardens during the winter. This set off a scramble for heaters that allowed people to socialize safely and warmly.

1. Analyze the effects of the restrictions on indoor gatherings on the price elasticity of demand for outdoor heaters. Also analyze the potential revenue implications for outdoor heating companies such as Herschel Infrared Heaters, a Bristol-based manufacturer and supplier.

2. With the aid of an indifference curve diagram(s), show how an increase in the price of a good relative to another good will impact on consumer choice. In addition, show and explain the new optimum consumption point as a result of the price change.

Answer rating: 100% (QA)

1 Analysis of the Effects of Restrictions on Outdoor Heater Demand The lockdown restrictions in England limiting indoor gatherings had a significant impact on the demand for outdoor heaters Heres an a... View the full answer