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3 years ago

What might cause a demand curve to shift to the right?

Business

1 answer:

dolphi86 [110]3 years ago

6 0

Answer:

D. An increase in the price of a substitute

Explanation:

<h2>Law of Demand</h2>

The law of demand states that as the price of a product of good <u>rises</u>, the <em>quantity demanded </em>for that good or product <u>falls</u>; conversely, if the price of a product or good <u>falls</u>, then the <em>quantity demanded</em> for that good <u>rises</u>.

Given the inverse relationship between the price of a good and the quantity demanded for that good, then its graph will show a <em>downward-sloping</em> demand curve.

A <u>change in demand</u> represents the leftward- or rightward-shift of the entire demand curve. This may be caused by the following factors:

Changes in the income of buyers

Changes in consumers' preferences,
A change in the price of related goods (<em>substitutes</em> and <em>complements</em>),
Number of buyers within a market, and
The buyers' expectation on the future prices of goods.

<h3>Types of Related Goods: </h3>

<u>Substitutes</u>: two similar goods that fulfill about the same needs or wants of the buyers.

Examples of substitute goods: Coca-Cola and Pepsi, butter and margarine.

<u>Complements</u>: these are two goods that are consumed together. When the price of one good goes up, the demand for the complement good declines.

Examples of complements: Tennis racket and tennis ball, ink cartridge and printers.

<h2>Answer:</h2><h3><u>Substitute goods:</u></h3>

If the price of one good rises, then the buyers will demand more of the substitute good with a lower price. This causes a rightward-shift on the demand curve of that substitute good.

This description matches <u>Option D</u>: an increase in the price of a substitute.

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Answer: See explanation

Explanation:

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3 years ago

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MrRissso [65]

Answer:

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Explanation:

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4 years ago

Orion Flour Mills purchased a new machine and made the following expenditures:

MatroZZZ [7]

Answer:

Orion Flour Mills Journal entry

Dr Equipment 62,400

Dr Prepaid Insurance 500

Cr Cash 2,900

Cr Accounts Payable 60,000

Explanation:

Calculation for cost of equipment

Purchase price 55,000

Add: Sales tax 5,000

Add: Shipment of machine 800

Add: Installation 1,600

Total Cost of Equipment 62,400

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3 years ago

A dam is being built that will cost $500,000. The dam will cost $20,000 per year to operate and will require a maintenance expen

liubo4ka [24]

Answer:

The capitalized cost will be "784,592".

Explanation:

The given values are:

Initial cost = $500,000

Annual operating cost = $20,000

Interest, i = 12% i.e., 0.12

Effective Two year interest rate, i₂ = $(1.12)^2 - 1$

= $0.2544$

As we know,

$Capitalized \ cost = Initial \ cost + \frac{Annual \ operating \ cost }{i} + \frac{Bi-annual \ maintenance \ cost}{i_{2}}$

Now on putting the estimated values in the above expression, we get

⇒ $=500,000+\frac{20,000 }{0.12} +\frac{30,000}{0.2544}$

⇒ $= 500000 + 166667 + 117925$

⇒ $= 784,592$

So that the above is the right answer.

4 0

4 years ago

Use the production function: Q = 4L1/2K1/2. Refer to Scenario 3. Suppose that the price of labor is $5 and the price of cap

inn [45]

Answer:

100 labor will be hired to minimize the costs of producing 200 units of output.

Explanation:

Maximising profit

Profit (Pr) = P*Q - Cost

= P*Q - 5L - 20K

= P*4(LK)^0.5 - 4L - 20K

dPr/dL= P*2(K/L)^0.5 - 4 = 0

dPr/dK = P*2(L/K)^0.5 - 20 =0

We know equilibrium condition

MPL/MPK = w/ r

= 5/20

= 0.25

MPL = 2(K/L)^0.5 MPK = 2(L/K)^0.5

K/L = 0.25

K = 0.25L

200 = 4(0.25L^2)^0.5

=4*0.5*L

L = 100

Therefore, 100 labor will be hired to minimize the costs of producing 200 units of output.

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4 years ago