Exam 2: Making Smart Choices: the Law of Demand

If the price of a movie ticket rises, the quantity demanded increases.

Phone data plans often charge a high price for the first 10 megabytes, a lower price for the next 100 megabytes, and a very low price for the next 1,000 megabytes. An economist would say this is because

After an intense workout at the gym with nothing to drink, the marginal benefit of a Gatorade would

Smart choices are based on a comparison of expected benefits and opportunity costs.

The diamond/water paradox can be explained by

Which "other things" are not kept constant along a demand curve?

Figure 2.4.1. -Look at Figure 2.4.1. A decrease in quantity demanded is

Some sales managers are talking about business. Which quotation refers to a movement along the demand curve?

Products and services that are rare and essential will typically have

Figure 2.3.1. -Look at the market for water in Figure 2.3.1. A movement from point B to point D is caused by a(n)

Your marginal benefits from a choice depend on your opportunity costs.

At $1.20 per litre you spent $240 on gasoline last month. Your

Franco the barber charges $15 for a haircut. He has 200 customers who each pay Franco $30 a month. Market demand for Franco's haircuts is

If the minimum age for buying beer was lowered to 16, the increase in the number of buyers increases the quantity demanded of beer.

As the price of a product or service rises, smart consumers switch to cheaper substitutes and demand decreases.

Charging people more for a product that has high marginal benefits is a bad business idea because people won't actually pay more.

Figure 2.4.1. -Look at Figure 2.4.1. An increase in quantity demanded is

Making a smart choice depends on what substitutes are available and what they cost.

The law of demand states that when price rises, quantity demanded increases.