A MOVEMENT ALONG THE SAME DEMAND CURVE IS CAUSED BY THE
A. price of the product ✓ B. price of other products C. income of the consumer D. taste of the consumer The answer to the question is: A. price of the product A movement along the same demand curve is caused by the price…
IF COMMODITIES X AND Y ARE SUBSTITUTE, THEIR CROSS ELASTICITY OF DEMAND WILL BE
A. One B. positive ✓ C. negative D. zero The answer to the question is: B. positive If commodities X and Y are substitutes, their cross elasticity of demand will be positive. This is because substitutes are goods that can be used in place…
IF THE QUANTITY DEMANDED OF A COMMODITY INCREASES FROM 20 UNITS TO 30 UNITS WHEN THERE IS AN INCREASE IN PRICE FROM 4.00 DOLLARS TO 5.00 DOLLARS, THE ELASTICITY OF DEMAND IS
The elasticity of demand is a measure of the responsiveness of the quantity demanded of a commodity to a change in its price. It is calculated using the following formula: Elasticity of Demand = Percentage Change in Quantity Demanded /…
THE DEMAND FOR A GOOD IS PRICE INELASTIC IF
A. The price elasticity is less than one ✓ B. The price elasticity is one C. The price elasticity is negative D. The price elasticity is greater than one The answer to the question is: A. The price elasticity is less than one…
DETERMINATION OF PRICE BY DEMAND AND SUPPLY
In a market, there are buyers and sellers. The buyers bring their money to the market to buy the goods (demand) while the sellers bring the goods to the market for sale (supply). Market equilibrium is determined by the interaction…
PRINCIPLES OF DEMAND
In order to know how a market economy works and how resources are allocated in an economic system, it is very important to understand what determines the demand and supply of goods and services. DEMAND Demand may be defined…