If hot dogs are inferior goods, the demand for hot dogs will rise as consumer income falls.
Question 1 options:
Whenever the price of Good A decreases, the demand for Good B increases. What do Goods A and B appear to be?
a) normal goods
b) inferior goods
Farmland can be used to produce either cattle or wheat. If the demand for cattle increases, what will happen in the market for wheat?
a) The demand for wheat will decrease.
b) The supply of wheat will decrease.
c) The supply of wheat will increase.
d) The demand for wheat will increase.
Why does the quantity of a good demanded decrease when its price increases?
a) Complements become relatively cheaper when the price of a good increases.
b) Consumer preferences change when the price of a good changes.
c) The nominal income of consumers falls when the price of a good increases.
d) Substitutes become relatively cheaper when the price of a good increases.
What will occur in the market if producers expect the price of televisions to fall in the near future?
a) The supply of televisions will rise in the future.
b) The supply of televisions will rise today.
c) The quantity supplied of televisions will rise today.
d) The supply for televisions will fall today.
Which of the following would most likely cause a reduction in the supply of Xbox video games?
Question 6 options:
a) an increase in the price of computer chips used to make Xbox games
b) a decrease in the price of Xbox video games
c) an increase in the demand for Xbox video games
d) a decrease in the price of computer chips used to make Xbox games
The law of demand suggests that a decrease in the price of a product will increase the demand for that product.
When Mom buys more Jell-O(™) because the price of pudding has risen, it is an example of the substitution effect.
A supply curve illustrates a direct relationship between what two items?
Question 9 options:
a) price and quantity demanded
b) price and demand
c) price and quantity supplied
d) price and supply
The law of supply suggests that a decrease in the price of a product will increase the quantity supplied for that product.