Which situation best illustrates an effect of the law of demand?A.A shop orders more computers when their selling price increases.B.A theater sells more popcorn after it lowers the price of popcorn.C.A car company increases sales when incomes rise in a city.D.A restaurant loses customers when a similar restaurant opens nearby.SUBMITarrow_backPREVIOUS
Question
Which situation best illustrates an effect of the law of demand?A.A shop orders more computers when their selling price increases.B.A theater sells more popcorn after it lowers the price of popcorn.C.A car company increases sales when incomes rise in a city.D.A restaurant loses customers when a similar restaurant opens nearby.SUBMITarrow_backPREVIOUS
Solution
The situation that best illustrates an effect of the law of demand is B. A theater sells more popcorn after it lowers the price of popcorn. The law of demand states that, if all other factors remain equal, the higher the price of a good, the less people will demand that good. In other words, the higher the price, the lower the quantity demanded. The amount of a good that buyers purchase at a higher price is less because as the price of a good goes up, so does the opportunity cost of buying that good. So, when the theater lowers the price of popcorn, more people are willing to buy it, which increases the quantity demanded.
Similar Questions
Which of the following situations best demonstrates the law of demand?Group of answer choicesMovie-goers react to an increase in the price of a theater ticket by seeing fewer movies per year.Movie-goers see fewer movies per year due to an overall decrease in the quality of newly released motion pictures.A drought causes a decrease in the availability of pumpkins, resulting in fewer jack-o-lanterns displayed on Halloween.An increase in the number of people writing Economics textbooks results in a decrease in average textbook prices.
Which situation best illustrates an effect of the law of supply?A.A restaurant increases the number of items on its menu to attract customers.B.A theater sells more tickets when incomes rise across a country.C.A store stocks more phones when it learns that their selling price has gone up.D.A car company sells a lot more cars after it lowers its prices
What does the law of demand suggest?A.Sellers increase their supply of a product as its price increases.B.Buyers increase their demand for a product as its price increases.C.Buyers increase their demand for a product as its price decreases.D.Sellers increase their supply of a product as its price decreases.SUBMITarrow_backPREVIOUS
The "law of demand" implies thatA.as prices fall, demand increases.B.as prices rise, quantity demanded increases.C.as prices rise, demand increases.D.as prices fall, quantity demanded increases.
A business has seen demand for its newest product fall rapidly. According to the law of demand, what is the most likely explanation for why this happened?A.The business created a shortage of the product.B.The business reduced the supply of the product.C.The business decreased the product's price.D.The business increased the product's price.
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