Which of the Following Causes an Increase in Demand for a Normal

question 270

Multiple Choice

Which of the following causes an increase in demand for a normal good?

• A) Increase in the price of a substitute
• B) Increase in the price of a complement
• C) Decrease in price
• D) Decrease in income

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Definitions:

Break-even Point

The point where a business's total costs and total revenues are the same, leading to neither a profit nor a loss.

Total Revenue Line

A graphical representation in break-even analysis that shows how total revenue changes with varying levels of sales volume.

Contribution Margin

The amount of revenue from sales that exceeds variable costs, contributing to covering fixed costs and generating profit.

Variable Expenses

Costs that change in relation to the business’s activity level or volume, similar to variable costs.