Which of the Following Statements About the Factors That Influence

question 406

Multiple Choice

Which of the following statements about the factors that influence demand is true?

• A)As the availability of close substitutes increases, the demand for a product increases.
• B)As real consumer income increases, demand for a product increases.
• C)As the price of close substitutes increases, demand for a product declines.
• D)Changing consumer tastes have little impact on demand for a product.
• E)As real consumer income decreases, demand for a product increases.

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Definitions:

Supply

The total amount of a product or service that is available to consumers, which can vary based on price, production costs, and other factors.

Elastic

A term used in economics to describe the sensitivity of the demand or supply of a good or service to changes in its price.

Perfectly Inelastic

A situation in which the quantity demanded or supplied does not change regardless of any change in price.

Fixed Number

A specific, unchanging quantity that does not vary under different conditions or over time.