According to the law of demand, there is an inverse relationship between price and quantity demanded. That is, the demand curve for goods and services slopes downward. Why?
A. when the price of a good increases, consumers' purchasing power falls, and they cannot buy as much of the good as they did prior to the price change
B. when price increases, quantity demanded increases
C. when the price of a good increases, consumers purchases complementary goods that are now relatively less expensive
D. A and C only
Ans: A. when the price of a good increases, consumers' purchasing power falls, and they cannot buy as much of the good as they did prior to the price change
You might also like to view...
Government subsidies are in place to protect the population rather to benefit the economy in the case of which recipient(s)?
(A) Tobacco growers in the United States. (B) National airlines in Western Europe. (C) Small farms in France. (D) A national car company in Indonesia.
The Lorenz curve shows the
a. functional distribution of income b. personal distribution of income c. relative percentage of income going to each of the resources d. demand for unskilled versus unskilled labor e. cumulative percentage of income received by cumulative percentages of households