All categories

2 years ago

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

Business

1 answer:

dolphi86 [110]2 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.

You might be interested in

What are jad and rad, and how do they differ from traditional fact-finding methods? what are the main advantages of team-based m

mezya [45]

<span>JAD, joint application development, is a joint process that uses both the user and IT together to create the application. RAD, rapid application development, is similar to JAD but is much faster and takes far less time. Both are fast methods and can save cost for a company. With JAD it is likely to get a more quality product due to the involvement of the user in creating the application.</span>

3 0

3 years ago

Kathy is working her way through college. she has a job at burger fast where she makes an annual salary of $12,500. what is her

Liula [17]

520.83 cents take the amount divide it by 12 then 2.

7 0

3 years ago

Susan put her savings into a mutual fund that paid a nominal interest rate of 3 percent a year at the beginning of 2005. the cpi

Ksju [112]

Answer:

-0.11% per year

Explanation:

Here, we want to calculate real interest rate.

Firstly, we calculate the inflation rate

mathematically the inflation rate = (cpi at the end of year - cpi at the beginning of year)/cpi at the beginning of year * 100%

Inflation rate = (232-225)/225 * 100% = 3.11%

we now proceed to calculate the real interest rate

mathematically, real interest rate = Nominal interest rate - inflation rate

from the question, nominal interest rate = 3%

real interest rate = 3% - 3.11% = -0.11%

This means that the real interest rate earned by sally is -0.11% per year

8 0

3 years ago

Which of the following is not a function of prices in a market system? Group of answer choices Prices send signals to buyers and

Sedaia [141]

Answer:

Prices ensure an equal distribution of goods and services among consumers.

Explanation:

The price mechanism helps in the efficient allocation of resources. There are a number of functions performed by the price mechanism. Prices send signals regarding resources. An increase and decrease in prices reflect surplus and deficit.

Price balances the demand and supply of a product. Price is inversely related to demand and positively related to the supply of a product. It is determined by the interaction of demand and supply and helps in balancing supply and demand.

For instance, an increase in demand would increase the price, this higher price will motivate the suppliers to increase quantity supplied thus balancing demand and supply.

Price helps in coordinating economic activities and helps buyers and sellers in decision making. However, they do not help in equal distribution of goods and services among consumers.

6 0

3 years ago

Worker A is more effective than Worker B. Both workers become less effective as their workloads increase. Both workers are paid

sineoko [7]

Answer: False

Explanation:

Question mentions that even though Worker A and Worker B are both paid the same salary and become less effective as their workload increase, Worker A is still more effective than Worker B.

The optimal allocation therefore would be one where Worker A get more of the 200 units of production than Worker B because they would be able to produce more as they are more effective.

8 0

3 years ago