Factors Influencing Demand and Price Changes Quiz

Cost of production is a factor influencing supply, not demand.

Pens and pencils are complementary goods, often used together.

With higher prices for substitutes, demand for the product is likely to increase.

The availability of close substitutes affects the elasticity of demand.

Decreasing demand for a product reduces demand for its complements.

Consumer income is not a determinant of price elasticity of demand.

As the price of smartphones decreases, demand for phone cases decreases.

Changes in consumer preferences can shift the demand curve.

Long-run supply tends to be more elastic due to increased flexibility.

Inelastic demand results in increased total revenue when prices rise.

Perfectly elastic demand means any price change results in quantity demanded changing to infinity.

Demand is inelastic when elasticity coefficient is less than -1.

Unitary elastic demand corresponds to a price elasticity coefficient of 1.

During a recession, demand for luxury cars typically decreases.