Economics - Study Mode

[#1226] If the price of Pepsi decreases relative to the price of Coke and 7-Up, the demand for
Correct Answer

(D) Coke and 7-Up will decrease

Explanation

Solution: If the price of Pepsi decreases relative to the price of Coke and 7-Up, the demand for Coke and 7-Up will decrease. A decrease in the price of a good normally results in an increase in the quanti ty demanded by consumers because of the law of demand, and conversel y, quant ity demanded decreases when price rises. So. here the decrease in price of Pepsi will increase in demand for it, while the demand for Coke and 7-Up will decrease because of no change in their price level.

[#1227] If the demand for a good is price elastic, a fall in its price will lead to: (i) A rise in sales (ii) A fall in sales (iii) A rise in total expenditure on the good (iv) A fall in total expenditure on the good
Correct Answer

(A) (i) and (iii) only

[#1228] 'Price Pool' is formed to:
Correct Answer

(C) Determine a price policy

[#1229] When the price of a substitute of commodity X falls, the demand for X-
Correct Answer

(B) falls

[#1230] The assessment of national income is prepared by
Correct Answer

(C) Central statical organization