Demand Review

Which of the following is NOT a component of demand?

• Desire

• Willingness

• Ability

• Supply

What does a demand schedule show?

• The quantities of a product or service that consumers are willing to buy at different prices.

• The prices at which different quantities of a product or service are sold.

• The costs of producing different quantities of a product or service.

• 1. The profits earned from selling different quantities of a product or service.

What is the relationship between price and quantity demanded according to the law of demand?

• Price and quantity demanded move in the same direction.

• Price and quantity demanded move in opposite directions.

• There is no relationship between price and quantity demanded.

• 1. The relationship between price and quantity demanded varies depending on the product or service.

What is marginal utility?

• The total satisfaction derived from consuming a good or service.

• The additional satisfaction derived from consuming an additional unit of a good or service.

• The cost of producing an additional unit of a good or service.

• 1. The price at which an additional unit of a good or service is sold.

What is the principle of diminishing marginal utility?

• The marginal utility of consuming a good or service increases as more units are consumed.

• The marginal utility of consuming a good or service decreases as more units are consumed.

• The marginal utility of consuming a good or service remains constant as more units are consumed.

• 1. The marginal utility of consuming a good or service is not affected by the quantity consumed.

What is a demand shifter?

• A factor that causes the entire demand curve to shift to the left or right.

• A factor that causes the price of a good or service to change.

• A factor that causes the quantity demanded of a good or service to change.

• 1. A factor that causes the supply of a good or service to change.

What effect does an increase in population have on demand?

• It increases demand.

• It decreases demand.

• It has no effect on demand.

• 1. The effect on demand depends on the specific product or service.

What effect does an increase in income have on demand for a non-inferior good?

• It increases demand.

• It decreases demand.

• It has no effect on demand.

• 1. The effect on demand depends on the specific product or service.

What effect do changes in tastes have on demand?

• They can increase or decrease demand.

• They always increase demand.

• They always decrease demand.

• 1. They have no effect on demand.

What effect do expectations about future prices have on current demand?

• They can increase or decrease demand.

• They always increase demand.

• They always decrease demand.

• 1. They have no effect on demand.