ECONOMICS
DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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decreases; falls
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increases; rises
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increases; falls
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decreases; rises
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Detailed explanation-1: -If the income increases, the demand for the good decreases and if there is a decrease in income, there is an increase in the demand for the good.
Detailed explanation-2: -If income decreases or the price of a complement rises, The demand curve for a normal good shifts leftward.
Detailed explanation-3: -A leftward shift in the demand curve indicates a decrease in demand because consumers are purchasing fewer products for the same price.
Detailed explanation-4: -The demand curve shifts to the left if the determinant causes demand to drop. That means less of the good or service is demanded. That happens during a recession when buyers’ incomes drop. They will buy less of everything, even though the price is the same.
Detailed explanation-5: -For a normal good, an increase in the consumer’s income causes an increase in the demand for the good. Hence, the demand curve for a normal good shift to the right as the consumer’s income increases and shifts to the left as the consumer’s income decreases.