If the Price of Ice Cream Decreases, Then the

question 91

Multiple Choice

If the price of ice cream decreases, then the

• A)quantity demanded for ice cream will increase.
• B)demand for ice cream will decrease.
• C)demand for ice cream will increase.
• D)quantity demanded for ice cream will decrease.
• E)supply of ice cream will decrease.

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Definitions:

Present Consumption

The act of using goods and services to satisfy current needs and desires rather than saving for future use.

Self-Control Problems

Refers to the difficulty people have in sticking with earlier plans and avoiding suboptimal decisions when finally confronted with a particular decision-making situation. A manifestation of time inconsistency and potentially avoidable by using precommitments.

Time Inconsistency

The human tendency to systematically misjudge at the present time what will actually end up being desired at a future time.

Behavioral Economists

Economists who study the psychological, cognitive, emotional, cultural, and social factors on the economic decisions of individuals and institutions.