Question

A factor that most directly affects the demand for automobiles is

Answer 1

The correct answer is individual preferences and tastes of buyers.

When there is increase in demand also the demand curve shifts. If there is a change in factor apart from price then the whole of demand curve shifts.

The income of consumers determines the demand of the commodity. Also prices which are related to goods and also preferences and tastes of the customer.

Demand for automobiles can be elastic where there can be  delay in buying a new vehicle.

Due to many substitutes the model for automobile can be highly elastic.

Answer 2

The factor that most directly affects the demand for automobiles is the individual tastes and preferences of buyers.

Further Explanations:

Demand is referred to as the economic principle showing the consumer’s desire to purchase goods and avail the services by paying the specified amount for that service. It is an obvious fact that the increase in demand occurs when there is a decrease in the price of the goods. Other factors are not considered much but the price is inversely proportional to the demand. Demand varies according to the prominent factors affecting the consumption and these variations are often handled by numerous Stocking strategies. In case when a customer tries to pay a minimal amount for the service at that time the supplier tries to maximize his profit by every means.  

In the case of automobiles, the factors that are directly affecting its demand are customers' tastes and preferences. A customer usually buys an automobile as per his requirement and price even though he finalizes his choice after satisfying that his requirement is fulfilled by his choice. We can also conclude that the sale also depends on the ability of the manufacturer to meet the demand of the buyer.

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Answer Details

Grade: High school

Subject: History

Chapter: Demand

Keywords: Demand, economic principle, consumers, specified amount, price, goods, inversely proportional, demand, prominent, Stocking strategies, automobiles, manufacturer.