Demand (Change in Demand v. Change in Qty Demanded)

According to the law of demand, what happens when the price of a robotic sandwich stuffer decreases?

• The demand for the stuffing used by sandwich stuffers decreases

• The quantity demanded of robotic sandwich stuffers increases.

• The supply of robotic sandwich stuffers decreases

• The quantity supplied of robotic sandwich stuffers increases

• The demand for robotic sandwich stuffers decreases

Answer explanation

The law of demand suggests that price and quantity demanded change in opposite directions. When the price of a good decreases, its quantity demanded increases.

All of the following influence whether a consumer buys more of a good EXCEPT:

• a change in the good's price

• how much other goods cost

• how much income the consumer has to spend

• whether or not it is legal to buy more of the good

• how much the consumer previously spent on the good

Answer explanation

A rational agent ignores costs that have already occurred because you can't change the past.

Which of the following movements in this graph would represent an increase in quantity demanded but not a change in demand?

• From point S to point R

• From point S to point T

• From point R to point U

• From point U to point T

• From point S to point U

Something has changed about how consumers buy hats, which has resulted in the change shown in the graph shown here. Which of the following changes could this graph represent?

• People like hats more than they did before, and their demand for hats has increased because of this

• People do not like hats as much as they did before, resulting in a movement along the demand curve.

• There has been a decrease in the price of hats, resulting in an increase in the quantity demanded for hats

• People do not like hats as much as they did before, so their demand has decreased

Meeps and Blops are two goods that are related to each other. When the price of Meeps goes down, the demand for Blops goes down.

Based only on the information given here, what kind of goods are Meeps and Blops?

• superior goods

• normal goods

• compliments

• substitutes

• inferior goods

Answer explanation

When the price of one good decreases, people will tend to buy more of that good, lowering the demand for substitute goods.

The demand for Good \[X\] is given in the graph shown here.

Which of the following could cause the shift of demand shown here?

• An increase in income if good X is an inferior good

• An increase in the number of buyers of a good

• People do not like good X as much as they did before

• Buyers of good X expect the price of good X to decrease in the future

• Buyers of good Y expect the price of good X to decrease in the future

Answer explanation

An increase in demand is shown, and an increase in the number of buyers will increase the demand for a good.

All of the following will result in a shift in a demand curve except:

• A change in the income of buyers

• A change in the supply of a good

• A change in expected future prices

• A change in the price of related goods

• A change in buyers' preferences

Answer explanation

Supply is not one of the five determinants of demand; a change in the supply of a good will not shift the demand curve.

A government is concerned about whether young children in a community are receiving enough healthcare.

Which of the following is the LEAST likely to increase the amount of healthcare that people provide their children?

• subsidize healthcare

• increase the price of healthcare

• reduce the distance traveled to get healthcare

• Provide coupons for free healthcare

• Lowering regulations on who can provide healthcare, such as allowing nurses to provide healthcare rather than just doctors

Answer explanation

If you increase the price of healthcare, it might induce more sellers to provide it, but it also discourages buyers from buying it.

Which of the following best describes the law of demand?

• People demand the same amount of a good no matter its price.

• When price decreases, the quantity demanded increases.

• Demand decreases for a normal good when incomes increase.

• Sellers set the price that demanders pay.

• Legal authorities regulate prices.

Answer explanation

The law of demand describes the relationship between price and quantity demanded. According to the law of demand, price and the quantity demanded have an inverse relationship.

Which of the following movements would represent an increase in the demand for a good?

• From S to U

• From R to T

• From T to U

• From S to R

• From R to S