Demand

Created by stefaniabettaglio 

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65 terms · Demand review economics

A change in income can cause the demand curve to shift (T/F)

True

The goal of the buyer in the marketplace is to pay a fair price (T/F)

False

A flat demand curve shows inelastic demand for a product (T/F)

False

The purpose of advertising is to increase demand for a product of service (T/F)

True

Wealthy people do not pay attention to the law of demand (T/F)

False

L.L. Bean's on-line ordering service must notify you if the shipment cannot be made on time (T/F)

True

Inferior goods are goods that are poor quality in craftsmanship (T/F)

False

An increase in population will likely increase the demand for housing, food, and many other goods and services (T/F)

True

Advertising can increase demand for a good or service (T/F)

True

A thirty percent rise in the price of snowboards may cause the demand for skis to increase (T/F)

True

Demand for a drug like insulin would be elastic

False

Demand can become more elastic over time (T/F)

True

If a firm knows that demand for its product is inelastic it will decrease prices in order to increase total revenue (T/F)

False

The law of Demand states that as prices decreases people generally want to buy more an item and vice versa (T/F)

True

Consumers should fill their automobiles today if they expect gasoline prices to drop $.10 a gallon tomorrow. (T/F)

False

A 10% rise in the price of salt would likely cause the demand curve to shift (T/F)

False

Demand for normal goods increases as income increase (T/F)

True

The Federal Trade Commission requires firms like L.L. Bean that sells products online to ship their merchandise within 30 days of receiving your order (T/F)

True

When creating a demand curve from a demand schedule the lowest prices are always on the bottom of the vertical axis and the highest prices are at the top (T/F)

True

When creating a demand curve from a demand schedule the lowest quantities demand are always on the left of the horizontal axis and the highest quantities are at the right. (T/F)

True

Demand for pizza would increase if the Federal government announced that pizza sauce has a natural ingredient that strengthened a person's resistance to the flu virus (T/F)

True

A hail storm in the Houston metropolitan area can cause the demand for shingles to increase (T/F)

True

Demand for inferior goods increase as a person's income increases (T/F)

False

Demand for Span tends to increase during economic recessions (T/F)

True

In general, the more substitues available for a product the more elastic the demand. (T/F)

True

If the price of Pepsi rises by 25% the demand for Coke will increase (T/F)

True

Goods regarded as necessities tend to have elastic demand (T/F)

False

A product such as lobster would have elastic demand (T/F)

True

Charles Darrow created the board game Monopoly during the Great Depression (T/F)

True

If an entrepreneur sells a product that has inelastic demand and decides to raise prices the result will be increased total revenue (T/F)

True

Demand is measured not only by consumer desire for a product, but also by

ability and willingness to buy the product

As a consumer, if the price of apples double and your salary remains the same, you would probably

buy fewer apples.

If the prie of a product decreases and consumers buy more of the product,

A change in quantity demanded has taken place

If consumer's income go up, for most products we can expect

an increase in demand

The statement "the demand for an economic product varies inversely with its price" is a definition of

the Law of Demand

Because the demand for local telephone service is relatively inelastic,

modest price increase have little or no impact on quantity demanded.

For the basic essentials of life, demand is based on

the urgency need.

An increase in the price of wombles causes a decrease in the demand for widgets. The two products are

complements

Store catalogs and television commercials are methods of

creating demand

A business raised the price of a product to increase profits, but found that total revenues went down. The demand for the product is

elastic

If the increase in the price of butter causes a decrease in demand for French pastries,

the two goods are complements

When consumers' income decline, consumers tend to

buy less regardless of price

All of the following are example of compliment EXCEPT

A butter and margarine

If a demand curve shows that 500 items are demanded at a price of $5,

the producer may or may not set the price of each item at $5.

A demand curve

Is smooth, slopes downward, and shifts when the price of substitute changes

The two variables on a demand curve are

price and quantity

When the price of onions doubled in which country did the people vote the ruiling party out of office?

India

When a consumer is able and willing to buy a good or service, he or she creates which of the following?

demand

What determines the price and quantity produced of most goods?

the interaction supply and demand

What are inferior goods?

goods for which the demand falls when income rises

How is future price related to current demand?

If the price is expected to rise, current demand will rise

What determines how a change in prices will affect total revenue for a company?

elasticity of demand

What kind of system is the United States economy based on?

Market

Ceteris paribus, or "all other things held constant," is an assumption that has which of the following effects on a demand schedule?

It takes only prices into account

What shows the quantities of products demanded at each price by all consumers in a market?

a market demand schedule

How did the existence of the baby bom generation change demand in the United States?

Demand was raised for different goods with each age the baby boomers reached.

What is a basic principle of the law of demand?

When a good's price is lower, people will buy more of it

How is the current demand for a good related to its future price?

If the price is expected to drop, current demand will fall.

Which of the following is a good that might not be bought when price rises?

luxury

what kind of changes would be expected in the demand of a country that has a growing population?

a rise in he demand for shelter

A shift in the demand curve means which of the following?

a change in demand at every price

what does unitary elastic demand mean?

The percentage change in quantity demanded is exactly equal to the percentage change in price

What is a company's total revenue?

the amount a company receives for selling its goods?

when prices rise, which of the following happens to income?

It buys less

which of the following goods would be likely to be bought in the same quantity even if it i doubled in price?

pencils

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