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Questions and Answers
What happens to demand when the price of a normal good increases?
What happens to demand when the price of a normal good increases?
- Demand becomes elastic
- Demand remains unchanged
- Demand decreases (correct)
- Demand increases
How do changes in consumer preferences impact demand for certain products?
How do changes in consumer preferences impact demand for certain products?
- They can significantly influence demand (correct)
- They lead to a decrease in demand
- They have no impact on demand
- They only affect supply, not demand
What happens to demand for a product when the price of its substitute increases?
What happens to demand for a product when the price of its substitute increases?
- Demand for the product increases (correct)
- Demand becomes perfectly elastic
- Demand for the product remains unchanged
- Demand for the product decreases
How can effective marketing strategies influence consumer behavior?
How can effective marketing strategies influence consumer behavior?
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How do changes in taxation, subsidies, or regulations impact demand for goods and services?
How do changes in taxation, subsidies, or regulations impact demand for goods and services?
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Study Notes
Demand Analysis
- When the price of a normal good increases, demand for it decreases, ceteris paribus.
- Changes in consumer preferences can increase or decrease demand for certain products, depending on whether the change is positive or negative.
Substitutes and Demand
- When the price of a substitute increases, demand for the original product increases, as consumers turn to the cheaper alternative.
Marketing and Demand
- Effective marketing strategies can increase demand for a product by altering consumer behavior, such as by changing perceptions or creating a sense of urgency.
Government Intervention and Demand
- Changes in taxation, subsidies, or regulations can impact demand for goods and services, by altering their relative prices or attractiveness to consumers.
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Description
Test your knowledge of demand determinants and consumer behavior with this quiz. Explore how factors such as price, consumer income, preferences, and related goods influence demand for products and services.
