Examkin

Soru

Zorluk: OrtaConcept and Law of Demand

An economic survey in a local market reveals that when the price of a gallon of vegetable oil increases from ₦8,000₦8,000 to ₦10,000₦10,000, a household reduces its monthly consumption from 55 gallons to 44 gallons, assuming all other factors remain constant (ceteris paribus). Which of the following best describes this economic outcome?

  1. A decrease in quantity demanded resulting from a price increase, illustrating the law of demandCevap
  2. B
    A decrease in overall demand causing a leftward shift of the demand curve
  3. C
    An outward shift of the demand curve caused by a rise in consumer income
  4. D
    A change in joint demand resulting from a price modification of a complementary commodity

Cevap

A decrease in quantity demanded resulting from a price increase, illustrating the law of demand
The scenario describes a change in the price of vegetable oil while holding all other factors constant (ceteris paribus). Under the Law of Demand, an increase in price leads to a decrease in quantity demanded. Because this change is driven solely by the commodity's own price, it is represented by a movement along the existing demand curve rather than a shift of the curve.

Adım Adım Çözüm

1
Identify the primary cause of the change in consumer behavior
The price of vegetable oil increased from ₦8,000₦8,000 to ₦10,000₦10,000 while all non-price factors remained constant.
Determining whether a price or non-price factor changed establishes whether there is a movement along the curve or a shift of the curve.
2
Analyze the direction of the consumer's response
Quantity purchased fell from 55 gallons to 44 gallons.
The inverse relationship between price and quantity purchased conforms directly to the Law of Demand.
3
Distinguish between a change in quantity demanded and a change in demand
A change in a commodity's own price produces a change in quantity demanded (movement along the demand curve), not a change in demand (shift of the curve).
Shifts in the demand curve are caused exclusively by non-price determinants such as consumer income, tastes, population, and prices of related goods.

Anahtar Kavram

Law of Demand and Movement Along the Demand Curve
Tahmini Süre:1m 0s
Bu soruyu puanla

Konular

Concept and Law of Demand

Bu konudan daha fazla soru