Demand

What does the law of demand state about the relationship between price and quantity demanded?

• Inverse relationship: as price increases, quantity demanded decreases

• Variable relationship: the effect of price on quantity demanded changes over time

• Direct relationship: as price increases, quantity demanded increases

• No relationship: changes in price do not affect quantity demanded

What effect describes the phenomenon where consumers buy more of a product when its price decreases because it becomes cheaper than its substitutes?

• Consumer preference effect

• Diminishing marginal utility

• Substitution effect

• Income effect

What is the effect called when a decrease in the price of milk leads to consumers feeling as though their purchasing power has increased?

• Substitution effect

• Income effect

• Price elasticity effect

• Consumer preference effect

According to the law of diminishing marginal utility, what happens to the additional satisfaction from consuming more of a product?

• It decreases over time

• It first decreases, then increases

• It increases over time

• It remains constant

What happens to the demand for a product if a study shows it has negative health effects?

• Demand curve becomes steeper

• No change in the demand curve

• Demand curve shifts to the right

• Demand curve shifts to the left

If the price of a complement to milk decreases, what happens to the demand for milk?

• Decreases

• Increases

• Remains the same

• Becomes more elastic

What happens to the demand curve when there is an increase in consumer income and the product is a normal good?

• Becomes steeper

• Shifts to the right

• Remains unchanged

• Shifts to the left

What causes a shift in the demand curve?

• A change in quantity demanded

• A temporary market fluctuation

• Changes in factors other than the product's price

• A change in the product's price

What is a change in quantity demanded?

• Shift of the demand curve due to changes in consumer preferences

• Shift of the demand curve due to a change in income

• Movement along the demand curve due to a change in the product's price

• Movement along the demand curve due to changes in the prices of related goods

What is the primary difference between a change in demand and a change in quantity demanded?

• Change in quantity demanded is caused by changes in consumer preferences, while change in demand is caused by price changes

• There is no significant difference between the two

• Change in demand is caused by factors other than price, while change in quantity demanded is caused by price changes

• Change in demand is caused by price changes, while change in quantity demanded is caused by income changes