ECONOMICS
SUPPLY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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A
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B
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C
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D
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Detailed explanation-1: -When there is an increase in the level of income of the consumers, then consumers tend to demand more at the prevailing price of goods. Therefore, it leads to a rightward shift of the demand curve indicating an increase in demand where price and quantity demanded of goods increase. So, the option is correct. b.
Detailed explanation-2: -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-3: -Answer: Movement of the demand curve happens when all other factors affecting the quantity demanded, remain constant and only the price changes. Hence, the demand moves upward or downward along the same curve.
Detailed explanation-4: -When the own price of a commodity falls, the quantity supplied will be reduced and hence, there will be a downward movement on the supply curve. The downward movement on the supply curve shows the contraction of supply.