What is the primary factor that causes a movement along a demand curve?
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B. A change in the price of the good. Movements along a demand curve are caused by changes in the price of the good, not by changes in other factors.
Which of the following would cause a shift of the demand curve for coffee to the right?
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C. A rise in the price of tea. A rise in the price of a substitute good (tea) would cause consumers to buy more coffee, shifting the demand curve for coffee to the right.
If the demand for a good increases when consumer income increases, the good is:
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A. A normal good. A normal good is one for which demand increases as consumer income increases.
What happens to the demand for ice cream if the price of ice cream cones decreases?
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C. There is a movement down along the demand curve. A decrease in the price of ice cream cones causes a movement down along the demand curve, not a shift of the curve.
Which of the following would cause a shift of the demand curve for pizza to the left?
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C. A decrease in consumer income. A decrease in consumer income would cause consumers to buy less pizza, shifting the demand curve for pizza to the left.
If the demand for a good decreases when the price of a related good decreases, the two goods are:
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C. Substitute goods. Substitute goods are goods that can be used in place of each other, so a decrease in the price of one good would cause a decrease in the demand for the other good.
What is the law of demand?
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A. As the price of a good increases, the quantity demanded decreases, all else being equal. This is the law of demand, which states that there is an inverse relationship between the price of a good and the quantity demanded, all else being equal.
Which of the following would cause a movement up along the demand curve for a good?
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A. An increase in the price of the good. A movement up along the demand curve is caused by an increase in the price of the good, not by changes in other factors.
If the demand for a good increases when the price of a related good increases, the two goods are:
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D. Complementary goods. Complementary goods are goods that are used together, so an increase in the price of one good would cause an increase in the demand for the other good.
What happens to the demand for a good if the price of an inferior good decreases?
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B. The demand curve shifts to the right. A decrease in the price of an inferior good would cause consumers to buy less of the good and more of the inferior good, shifting the demand curve for the good to the right.
Which of the following would cause a shift of the demand curve for a good to the right?
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C. An increase in the price of a substitute good. An increase in the price of a substitute good would cause consumers to buy more of the good, shifting the demand curve to the right.
If the demand for a good is price elastic, a decrease in the price of the good will:
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A. Increase total revenue. If demand is price elastic, a decrease in price will cause a more than proportional increase in quantity demanded, leading to an increase in total revenue.
Which of the following is an example of a movement along the demand curve for a good?
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C. An increase in the price of the good causes consumers to buy less of the good. A movement along the demand curve is caused by a change in the price of the good, not by changes in other factors.
If the demand for a good is price inelastic, an increase in the price of the good will:
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A. Increase total revenue. If demand is price inelastic, an increase in price will cause a less than proportional decrease in quantity demanded, leading to an increase in total revenue.
Which of the following would cause a shift of the demand curve for a good to the left?
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C. A decrease in consumer income. A decrease in consumer income would cause consumers to buy less of the good, shifting the demand curve to the left.