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Module 5

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Demand - Practice Quiz

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À propos de Test
macroeconomics
12th grade
demand
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Zachary Foust
Zachary Foust
United States

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Module 5Version en ligne

Demand - Practice Quiz

par Zachary Foust
1

Will an increase in consumer income cause the demand for cotton to increase, decrease, or remain unchanged?

2

Will an increase in consumer income cause the demand for an inferior good to increase, decrease, or remain unchanged?

3

Will an increase in the price of cotton cause the demand for cotton to increase, decrease, or remain unchanged?

4

Will an increase in the expected price of cotton cause the demand for cotton to increase, decrease, or remain unchanged?

5

Will a decrease in the price of polyester, a substitute for cotton, cause the demand for cotton to increase, decrease, or remain unchanged?

6

Will an increase in the price of a complement cause the demand for cotton to increase, decrease, or remain unchanged?

7

Which of the following will lead to an increase in the demand for cotton?

8

Which of the following will cause the demand for cotton to increase?

9

Which of the following will cause the demand for cotton to increase?

10

Which of the following will cause the demand for cotton to decrease?

Feedback

Cotton is an example of a normal good. When consumer income increases, buyers are able to purchase a larger quantity of a normal good regardless of the price.

An inferior good is a low quality substitute. If consumer income rises, buyers are able to purchase better alternatives, so the demand for the inferior good will fall. Questions will specify if a good is an inferior good.

There is a difference between quantity demanded and demand. According to the law of demand, a change in the price of a product inversely affects the quantity demanded, however, a change in the price of a product has no effect on demand. This is because a change in price does not result in a new demand schedule or demand curve.

There is a difference between price and expected price. While a change in the price of a product has no effect on demand, a change in the expected price of a product does affect demand. If consumer expect the price of a product to rise, they are willing to buy more of the product now while it is relatively cheaper.

Substitutes are products that serve a similar purpose. If the price of a substitute decreases, then consumers will buy more of the substitute instead of the other product. Questions will usually specify if products are substitutes.

Complements are products that are bought together. If the price of a complement rises, consumers will purchase less of both products.

Preference refers to the popularity of a product. If a product becomes more popular, then the demand for the product will increase.

An increase in the number of consumers means that their are more potential buyers of cotton.

Substitutes are products that serve a similar purpose. If the price of a substitute increases, then consumers will buy more of the other product because it is relatively cheaper. Questions will usually specify if products are substitutes.

Complements are products that are bought together. If the price of a complement rises, consumers will purchase less of both products.

 
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