The \"law of demand\" refers to the fact that, other things remaining the same,

Question

The "law of demand" refers to the fact that, other things remaining the same, when the price of a good rises, Select one a. there is a movement down along the demand curve to a larger quantity demanded b. there is a movement up along the demand curve to a smaller quantity demanded. Oc. the demand curve shifts leftward. O d. the demand curve shifts rightward and there is a movement up along the demand curve to a smaller quantity demanded. e. the demand curve shifts rightward. The downward slope of a demand curve Select one: a. indicates how demand changes when incomes rise and the good is a normal good. b. shows that as the price of a good rises, consumers increase the quantity they demand. c, represents the law of demand. d. indicates how demand changes when the price changes and the good is a normal good. e. indicates how the quantity demanded changes when incomes rise and the good is a normal good A demand curve Select one: a. is a graph of the relationship between quantity demanded of a good and its price. O b. Both answers has a downward slope and is a graph of the relationship between quantity demanded of a good and its price are correct. c. Both answers has an upward slope and is a graph of the relationship between quantity demanded of a good and its price are correct. d, has an upward slope. e. has a downward slope. Car insurance and cars are complements. If the price of car insurance increases, the Select one: O a. demand for cars increases. b. quantity of cars demanded decreases. c.quantity of cars demanded increases. O d. More information is needed to determine if the demand increases or decreases. O e. demand for cars decreases.

Explanation / Answer

Question 1: B. There is a movement up along the demand curve to a smaller quantity demanded.

Explanation: The law of demand states that other things remaining constant, when the price goes up quantity demanded goes down and when the price goes down, the quantity demanded goes up.

Question 2: C. Represents the law of demand

Explanation: The law of demand states that other things remaining constant, when the price goes up quantity demanded goes down and when the price goes down, the quantity demanded goes up. This is why the demand curve slopes downward.

Question 3: B. Both answers has a downward slope and is a graph of the relationship between quantity demanded of a good and its price are correct

Explanation: A demand curve is downward sloping as when the price goes up, the quantity demanded goes down. Also, a demand curve shows how the quantity demanded change with price.

Question 4: B. Quantity of cars demanded decreases

Explanation: In case of complementary goods, when the price of one good increases, the quantity demanded of the other good falls.

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