ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -One of the demand shifters is buyers’ expectations. If a buyer expects the price of a good to go down in the future, they hold off buying it today, so the demand for that good today decreases. On the other hand, if a buyer expects the price to go up in the future, the demand for the good today increases.

Detailed explanation-2: -A customer is surrounded by four key factors when considering any purchase: the product, the price, the promotion and the sales channel. Shopping in a physical store isn’t the same experience as shopping online, neither shopping in a website or a mobile app.

Detailed explanation-3: -that a critical reference price is the expectation of future price. That is, consumers compare sticker price with expected future price. Higher (lower) ex-pected future price encourages (discourages) current purchase.

Detailed explanation-4: -Answer and Explanation: An increase in the expected future price of a good will cause the current demand for the good to: d. increase, which is a shift to the right of the demand curve. An increase in the expected future price will make purchasing the good today more attractive across all price levels.

Detailed explanation-5: -Expectations: If suppliers expect prices to go up in the future, they decrease their supply today and save inventory to sell for a higher price in the future.