Question

An increase in the price of ice cream is likely to cause: Multiple Choice a movement to the left along the demand curve for ice cream. an inward shift of the demand curve for ice cream. an outward shift of the demand curve for ice cream. a movement to the right along the demand curve for ice cream.

Answer 1

Answer:

a movement to the left along the demand curve for ice cream.

Explanation:

A product can be defined as any physical object or material that typically satisfy and meets the demands, needs or wants of customers. Some examples of a product are mobile phones, television, microphone, microwave oven, bread, pencil, freezer, beverages, soft drinks etc.

Price can be defined as the amount of money that is required to be paid by a buyer (customer) to a seller (producer) in order to acquire goods and services.

Thus, it's the amount of money a customer or consumer buying goods and services are willing to pay for the goods and services being offered. The price of goods and services are primarily being set by the seller or service provider.

In sales and marketing, pricing of products is considered to be an essential element of a business firm's marketing mix because place, promotion and product largely depends on it.

One of the importance associated with the pricing of products is that, it improves the image of a business firm.

In Economics, there are primarily two (2) factors which affect the availability and the price at which goods and services are sold or provided, these are demand and supply.

The law of demand states that, the higher the demand for goods and services, the higher the price it would be sold all things being equal.

Thus, there exist a negative relationship between the quantity of goods demanded and the price of a good i.e when the prices of goods and services in the market increases or rises: there would be a significant decline or fall in the demand for this goods and services.

This ultimately implies that, an increase in the price level of a product usually results in a decrease in the quality of real output demanded along the aggregate demand curve.

In conclusion, an increase in the price of ice cream is likely to cause a movement to the left i.e a decrease along the demand curve for ice cream.