Practice Quiz

CLEP Principles of Macroeconomics Exam Prep

Category - Macroeconomics

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Although demand changes with a change in price, there are also five general changes that will also lead to a change in demand for people-regardless of whether or not the price changes. Which of the following is one of these changes?
  1. Change in the price of other products
  2. Change in level of income
  3. Change in individual tastes
  4. All of the above
Explanation
Answer - D - All of the above items could potentially lead to a change in demand for a product-whether or not the price changes.

Key Takeaway: The five general changes that can lead to a change in demand are: change in the price of other products, change in income level (up or down), change in individual tastes, a change in the expected future price of the item (will it be worth something someday?), or a change in information about the product that is supplied to consumers.
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