ECONOMICS
DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Mikayla buys a new skirt style that she saw in a fashion magazine.
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Jacob’s wages go up, so he buys an extra pair of basketball shoes.
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The price of fuel containing ethanol drops, so gasoline sales decrease.
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Emma buys 10 pounds of coffee because crops are failing in Kenya.
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Detailed explanation-1: -Consumer expectations cause people to demand either more or less of a good. A change in the total number of consumers causes the entire demand curve to shift right or left.
Detailed explanation-2: -Example: When consumers predict that the price of housing is going to increase, many people try to purchase homes before the increase in price occurs. In this way, the increase in expectation causes a rise in consumer demand.
Detailed explanation-3: -The demand for a good increases or decreases depending on several factors. This includes the product’s price, perceived quality, advertising spend, consumer income, consumer confidence, and changes in taste and fashion.
Detailed explanation-4: -If consumers expect higher coffee prices in the future: The demand for coffee will increase now. If the government decides to subsidize the production of a good, the result would be a decrease in the equilibrium price and a decrease in the equilibrium quantity.