ECONOMICS
CONSUMERS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Products and services produced in the economy are determined by consumer income.
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Planned obsolescence has given businesses an opportunity to take advantage of consumer wants.
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Firms develop and produce goods and services ultimately based on what they think consumers want
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An economic downturn will reduce the demand for luxury goods such as jewellery
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Detailed explanation-1: -Consumer sovereignty is the economic concept that the consumer has some controlling power over goods that are produced, and the idea that the consumer is the best judge of their own welfare.
Detailed explanation-2: -Consumer sovereignty (demand) determines the types and quantities of goods to be produced given the scarce resources of the economy. Consumers spend their income on the goods and services that they most want. In doing so, they SHOW producers what they want.
Detailed explanation-3: -Consumer Sovereignty & Types of Economy For example, in a free market, consumers have the highest levels of consumer sovereignty. The consumer is free to buy any commodity and in whatever quantities his likes. However, in a command economy, the state or central government decides what to produce.
Detailed explanation-4: -An example of consumer sovereignty is when companies bring in consumers to test products or listen to pitches for new ideas. It gives the consumer power in the decision making process before products go into production.