ECONOMICS
DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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increase in price
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decrease in price
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decrease in market size
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None of the above
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Detailed explanation-1: -The demand for a good decreases, if the price of one of its complements rises. The demand for a normal good increases if income increases. The demand for an inferior good decreases if income increases. Expected future income and expected future prices influence demand today.
Detailed explanation-2: -Explanation: A decrease in the price of new automobiles would cause a movement along the demand curve. Perceived ugliness and expectations of lower prices would decrease the demand.
Detailed explanation-3: -Answer and Explanation: The correct answer A.) a decrease in the price of a substitute good.
Detailed explanation-4: -Complementary goods are bought along with the normal goods and are consumed together by consumers. Complementary goods cannot be consumed individually. So, if the price of complementary goods rises, the normal goods become expensive, and consumers will stop buying them. Hence, the demand will decrease.