A Theory Asserts That Consumers Will Purchase Less of a Good

question 242

Multiple Choice

A theory asserts that consumers will purchase less of a good at higher prices than they will at lower prices. However, when the average price of cars increased throughout the 1990s, more cars were purchased. Which of the following explanations of the apparent conflict between theory and data is most accurate?

• A) The price and quantity data gathered by researchers was clearly measured incorrectly.
• B) It is likely that variables other than the price and quantity of cars demanded were changing.
• C) The ceteris paribus assumption is valid.
• D) The theory must be invalid.

---

Definitions:

Self-reflection

The examination of one's own thoughts, feelings, and behaviors to gain insight or achieve personal growth.

Extroversion

A personality trait characterized by a focus on external environments and social interaction, often associated with energy and affirmative action.

Develop Depression

The process of experiencing a significant and persistent low mood, often accompanied by low self-esteem and loss of interest in normally enjoyable activities.

Marry

The legal or formal recognition of a partnership, typically between two individuals, in various cultural or religious traditions.