(B) shift the demand curve for automobiles to the right. Profits and losses play an important role in helping (A) to signal to government which businesses are suffering losses so that they can be subsidized. (B) consumers decide which products they value the most by looking at each firm's profit.
Market prices provide information to consumers, helping them coordinate their activities so long as (A) competition is present and buyers and sellers are free to choose mutually agreeable prices. (B) prices are not allowed to rise too high, causing a shortage.
5) Consumers have been buying fewer CDs as downloadable music has become easier to purchase and use. We would represent this as A) a leftward shift of the demand curve for CDs.
(C) The equilibrium quantity will increase. Market prices provide information to consumers, helping them coordinate their activities so long as (A) competition is present and buyers and sellers are free to choose mutually agreeable prices.
d) buy 2 percent more of the product in response to a 1 percent decrease in price. How would a decrease in consumer income affect the market for new automobiles, a normal good? a) Demand would increase, leading to a reduction in price and an increase in quantity sold.
Explanation: Number of buyers is a determinant of demand. An increase in the number of buyers leads to an increase in demand. Ceteris paribus, which of the following would generally cause an increase in the demand curve for new automobiles? An increase in consumers' income.
As the price of gas increases, buying and operating a car becomes more expensive. Thus we expect the demand for cars to decrease. An increase in the price of gasoline induces a move away from cars with low mileage per gallon to cars with higher mileage per gallon.
Macroeconomic conditions affect labor supply and demand. Job losses during a recession mean less disposable income for consumers and less demand for cars. Automakers respond by reducing production, which leads to layoffs and reduced labor demand. Demand for cars usually increases in a growing economy.
Factors that can shift the demand curve for goods and services, causing a different quantity to be demanded at any given price, include changes in tastes, population, income, prices of substitute or complement goods, and expectations about future conditions and prices.
Which of the following will cause demand for cable television to decrease? A decrease in the price of online streaming media, a substitute service. Which of the following statement is accurate about the quantity supplied of a good or service? It is directly related to the price of that good or service.
Demand for goods and services is not constant over time. As a result, the demand curve constantly shifts left or right. There are five significant factors that cause a shift in the demand curve: income, trends and tastes, prices of related goods, expectations as well as the size and composition of the population.
A change in the price of a good or service causes a movement along a specific demand curve, and it typically leads to some change in the quantity demanded, but it does not shift the demand curve.