1-Which variable is NOT a demand shifter? Select one: a. price of complements b.
ID: 1161290 • Letter: 1
Question
1-Which variable is NOT a demand shifter?
Select one:
a. price of complements
b. price of substitutes
c. price of raw materials
d. tastes and preferences
2- What does the law of supply state?
Select one:
a. There is a positive relationship between price and quantity supplied.
b. There is a negative relationship between price and quantity supplied.
c. When prices rise, suppliers sell more.
d. When prices rise, buyers buy less of the product.
3- What can cause both equilibrium price and quantity to increase?
Select one:
a. an increase in the price of a complement good
b. a decrease in the population
c. consumer tastes becoming more favorable toward the good
d. an increase in the number of sellers
Explanation / Answer
Answer 1
The answer is Option C.
The variable responsible for shift in demand curve are:
Answer 2
Law of supply is a direct relationship between price and quantity supplied.
The supply of any product are always positive(+).
So, the answer is Option A.
Answer 3
Option A : An increase in the price of a complement good decrease the demand of the this goods and also decrease the equilibrium point. So, this option is not correct.
Option B : A decrease in the population also decrease the demand of the good and move curve to the left side and decrease the equilibrium point. So, this option is not correct.
Option C : Consumer tastes becoming more favorable toward the good will increase the demand of goods. To meet this demand, the supply will also increase. This increase will help in increasing equilibrium point in which both equilibrium price and quantity increase. So, this option is correct.
Option D : An increase in the number of sellers will only increase the supply in the market not demand. this will shift the supply curve toward right but decrease the equilibrium point. So, this option is not correct.
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