Use the following to answer question 4: Figure: Demand for DVDs Rental price of

Question

Use the following to answer question 4: Figure: Demand for DVDs Rental price of of DVDs DVDs o Quantity (per period) 0 Quantity (per period) Rental price of DVDs Rental price of DVDs 0 Quantity (per period) 0 Quantity (per period) A decrease i 4. (Figure: Demand for DVDs) Examine the figure Demand for DVDs rental price of DVDs would result in a change illustrated b A) the move from I to m in panel D. B) the move fromj to k in panel C. C) the move from fto g in panel A. D) the move from h to i in panel B.

Explanation / Answer

4) The asnwer is B -) the move from j to k in panel C.

a decrease in rental price of DVDs would result in increase in the quantity demanded of DVDs. When the price change , the effect of price change on quantity demand will shown by the movement along the demand curve. the shifment of the demand curve is happen when the price is held constant , the quantity demanded increase due to other factors. therefore when the price of DVDs decrease , the quantity demanded will increase of DVDs and it is shown by the movement along the demand curve from point J to K.

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