Factors Affecting Demand - SS1 Economics Past Questions & Answers - page 1

1

Which of the following factors affect demand?

A

Income, tastes, and preferences

B

Cost of production, government policies, and technology

C

Availability of raw materials, transportation costs, and taxes

D

All of the above

CORRECT OPTION: a
2

Which of the following is not a factor affecting demand?

A

 Availability and price of substitutes

B

 Government policies

C

 Production costs

D

Consumer preferences and tastes

CORRECT OPTION: c
3

Which of the following is an example of a government policy that can affect demand?

A

Tax on cigarettes

B

Release of a new iPhone model

C

A celebrity endorsement of a product

D

 None of the above

CORRECT OPTION: a
4

What are the three factors that affect demand? Explain how each factor affects demand.

Three factors that affect demand include:

  • Income of the consumer: The higher the income of consumers, the higher the demand for most goods and services.

  • Price of substitutes: The availability and lower price of substitutes can decrease the demand for a particular good or service.

  • Consumer preferences: Consumer preferences and tastes heavily influence the demand for goods and services.

 

Pages: