If Consumers Expect Future Prices to Be Higher

question 50

Multiple Choice

If consumers expect future prices to be higher

• A) they substitute current purchases for future purchases of perishable products.
• B) stockpiling will happen when products are durable in nature.
• C) the position of the demand will not change.
• D) the demand for automobiles today will not change.

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Definitions:

Social Dilemmas

Situations in which individual decision-makers face choices where the outcome of one choice will lead to suboptimal outcomes for all involved parties.

Fossil Fuels

Natural fuels such as coal, oil, and natural gas formed from the decomposed remains of ancient plants and animals, used as a primary energy source.

Tragedy of the Commons

A situation in a shared-resource system where individual users acting independently according to their own self-interest behave contrary to the common good of all users by depleting or spoiling that resource.

Public Goods Dilemma

A situation in which the consumption of a good by one individual does not reduce its availability to others, leading to potential overuse or depletion.