Macroeconomics

Question 1

What is the law of demand?

Answer 1

1-Price decreases and the demand increases

or

2-Price increases and the demand decreases

Question 2

Inverse relationship

Answer 2

Income effect
Substitution effect
Law of diminishing marginal

Question 3

Income effect

Answer 3

Price decreases consumer can buy more

Question 4

Substitution effect

Answer 4

A has a lower cost of b people are going to buy A

Question 5

Diminishing margin

Answer 5

less satisfaction therefore only buy when it’s low price.

Question 6

When a Demand graph line move to the right

Answer 6

It represent an increases in demand

Question 7

Demand line move left

Answer 7

It represent an decreases in demand

Question 8

What determines of the line of demand moves left or right

Answer 8

Consumer Expeditions
Number of buyers
Level of Income
Price of Related Goods
Tastes and Preferences

Question 9

Tastes and preferences

Answer 9

Product A is more desirable than product B therefore A will have increase in demand