Answer:
The answer is D. The change in quantity demanded of a good that results from a change in price, making the good more or less expensive relative to other goods, holding constant the effect of the price change on consumer purchasing power
Explanation:
Substitution effect is a concept in which, as the price of a good or service increases, less of the good or service is substituted for other less expensive.
For example, if the price of Pepsi were to rise, the substitution effect would cause the consumer to buy less of it and substitute more coca-cola for now relatively more expensive Pepsi.
Option A. is wrong because we are talking about the quantity demanded and not just demand. (Please take note).
Answer:
Binding
$100
200
200
Shortage
Explanation:
A price ceiling is when the government or an agency of the government sets the maximum price for a good.
A price ceiling is binding when the price ceiling is below the equilibrium price.
To find the equilibrium price, equate qs to qd because at equilibrium, quantity supplied is equal to quantity demanded.
2P = 300 - P
3P = 300
P = 100
Equilibrium price is $100.
$100 > $90. Therefore, price ceiling is binding.
To find quantity supplied, plug in the value of P into the equation for quantity supplied
QS = 2(100) = 200
To find quantity demanded, plug in the value of P into the equation for quantity demanded
QD = 300 - 100 = 200
when price is below equilibrium price, quantity demanded increases while the quantity supplied decreases. This leads to a shortage.
I hope my answer helps you
Kung ako ay magiging Pangulo nang Pilipinas, ang limang programa na aking gagawin ay ang Magtanim ng mga puno sa kagubatan para maiwasan ang flood, pagpapa-aral sa mga batang hindi nag-aaral, Pagbibigay ng tulong sa sapat na pambili, Pagtupad ng mga batas na nakakabuti sa mga mamamayan, pagtulong sa mga may sakit.
