Economic Consumption and Income
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Questions and Answers

What is the primary factor that determines an individual's consumption pattern?

  • Consumer confidence
  • Price level of goods and services
  • Level of income (correct)
  • Interest rates
  • What happens to consumption when prices of goods and services rise?

  • Consumers reduce their consumption (correct)
  • Consumers increase their spending
  • Consumers seek cheaper alternatives
  • Consumers remain unaffected
  • What is the effect of higher interest rates on loans and mortgages on consumption?

  • It increases consumer confidence
  • It discourages borrowing for consumption purposes (correct)
  • It stimulates borrowing and spending
  • It has no effect on consumption
  • What is the relationship between income and consumption?

    <p>not always linear</p> Signup and view all the answers

    What is the effect of lower prices on goods and services on consumption?

    <p>It stimulates consumption</p> Signup and view all the answers

    What is the impact of consumer confidence on consumption?

    <p>It increases consumption</p> Signup and view all the answers

    What is a key consequence of economic uncertainty on consumption patterns?

    <p>Decreased consumption due to caution</p> Signup and view all the answers

    How do demographics influence consumption patterns?

    <p>Through factors such as age, household size, and family structure</p> Signup and view all the answers

    What role do individual preferences and cultural norms play in shaping consumption patterns?

    <p>A significant role</p> Signup and view all the answers

    How can government policies affect consumption?

    <p>Directly or indirectly through taxation, subsidies, and regulations</p> Signup and view all the answers

    What impact can advances in technology have on consumption patterns?

    <p>On consumer preferences, production, and distribution</p> Signup and view all the answers

    What is a consequence of increasing awareness of environmental issues and social responsibility?

    <p>Increased preference for environmentally friendly products and ethical consumerism</p> Signup and view all the answers

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