ECONOMICS
DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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demand ____ right
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demand ____ left
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supply ____ right
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supply ____ left
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Detailed explanation-1: -If the price of a substitute good increases, this will result in an increase in demand for the original product. If the price of Pepsi Cola increases, the demand for Pepsi Cola will decrease, and the demand for Coca Cola will increase.
Detailed explanation-2: -Shift to right, As due to increase in price of Pepsi, its substitute Coca Cola demand will increase & thus its demand curve shifts to right. Was this answer helpful?
Detailed explanation-3: -So, when the price of Pepsi increases, the demand for Coke increases, and when the price of Pepsi decreases, the demand for coke decreases. So when the price of pepsi increases, consumers will substitute Pepsi with coke, thus the demand for coke will increase.
Detailed explanation-4: -If two goods are substitutes for each other, the price of one and the demand for the other are directly related. For example, if Pepsi-Cola and Coca-Cola are substitutes, an increase in the price of Pepsi-Cola will increase the demand for Coca-Cola.