Demand

A good that replaces another demanded good

• Complement
• Inferior
• Normal
• Substitute

A good that is always used with another good

• Complement
• Inferior
• Normal
• Substitute

When a consumer is able to buy a good or service, he or she creates

• Consumption
• Demand
• Elasticity
• Allocation

What are inferior goods?

• Goods that are not well produced
• Goods that no one wants to buy
• Good for which demand rises when incomes falls
• Goods for which the demand falls when income rises

How is future price related to current demand?

• If the price is expected to rise, current demand will drop
• If the price is expected to fall, current demand will rise
• If the price is expected to rise, current demand will rise
• Future price is not related to current demand

What does it mean when the demand for a product is inelastic

• People will not buy any of the product when the price goes up
• A price increase does not have significant impact on buying habits
• Customers are sensitive to the price of the product
• There are very few satisfactory substitutes for the product

What is a basic principle of the law of demand

• The higher the price, the more people will want the good
• Everyone has a limited income that they will spend
• When a good's price is lower, people will buy more of it
• Services are of interest in the same way that goods are

How is the current demand for a good related to its future price?

• If the price is expected to drop, current demand will fall
• If the price is expected to drop, current demand will rise
• If the price is expected to rise, current demand will fall
• Current demand is not related to future price

Which of the following is a good might not be bought when prices rise?

• Complement
• Substitute
• Inferior good
• Luxury

What does unitary elastic demand mean?

• The elasticity demand is mathematically determined
• The elasticity of demand is different at each unit on the price range
• The demand is inelastic at a low price but becomes elastic as the price rises
• The percentage change in quantity demanded is exactly equal to the percentage change in price