ECONOMICS
DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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normal goods.
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substitutes.
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inferior goods.
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complements.
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Detailed explanation-1: -A drop in the price of a compact disc shifts the demand curve for prerecorded tapes leftward. From that you know compact discs and prerecorded tapes are. normal goods. substitutes.
Detailed explanation-2: -Which of the following will cause the demand curve for the Beatles’ compact discs to shift to the right? Due to the recent increase in the price of natural gas, the quantity of coal demanded by electric power generation plants has increased.
Detailed explanation-3: -Answer and Explanation: A change in the price of a good does not shift the demand curve.
Detailed explanation-4: -Factors that can shift the demand curve for goods and services, causing a different quantity to be demanded at any given price, include changes in tastes, population, income, prices of substitute or complement goods, and expectations about future conditions and prices.
Detailed explanation-5: -A and B are complementary goods. Here, as the price of product A declines, the demand curve for product B shift rightwards. Therefore, it can be stated that both products A and B complement each other as they have a negative cross-price elasticity of demand.