A demand curve is downward-sloping because as the price of a good falls, demanders will substitute some other good for that good whose price has fallen.
Answer the following statement true (T) or false (F)
False
The law of demand does depend upon individuals' ability to substitute, but as the price of a good falls, demanders will substitute away from some other good toward the good whose price has fallen.
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Refer to the table above. What is the average monthly wage?
A) $612 B) $650 C) $558 D) $450
What is rational ignorance?
What will be an ideal response?
Advocates of real business cycle theories argue that all of the following could cause a recession except
a. a fall in consumer expectations. b. natural disasters. c. higher taxation. d. increases in the price of oil.
Exhibit 5-1 Demand curve
?
If demand price elasticity is 2, consumers would:
A. buy twice as much of the product in response to a 10 percent decrease in prie. B. require a 2 percent drop in price to increase their purchases by 1 percent. C. buy 2 percent more of the product in response to a 1 percent decrease in price. D. buy twice as much of the product in response to a 1 percent decrease in price.