A Typical Demand Curve Shows That

question 266

Multiple Choice

A typical demand curve shows that:

• A) as people earn more income, they buy more of a good.
• B) as supply increases, the amount purchased decreases.
• C) people tend to buy more of a good than they really want.
• D) people tend to buy more of a good when its price decreases.

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Definitions:

Labor

The human effort, including both physical and mental, used in the production of goods and services.

Leisure

Time free from work or duties, often used for relaxation, hobbies, or other personal activities.

Nonlabor Income

Income received that does not originate from employment or working, such as dividends, interest, or rental income.

Wage Rate

The fixed amount of compensation or payment given to an employee by an employer in return for work performed, typically expressed on an hourly, daily, or piecework basis.