Exercise 1 - Exercise 1 1. If other things constant, then...

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Exercise 1 1. If other things constant, then according to the law of demand, there is: A. an inverse relation between price and the quantity demanded; B. an inverse relation between price and demand; C. a direct relation between price and the quantity demanded; D. a direct relation between price and demand. 2. According to the law of demand: A. people buy more when the price declines because their income increases at the same time; B. people buy more when the price declines only if their income increases at the same time; C. people buy more when the price declines even if other demand determinants change at the same time; D. people buy more when the price declines, given all else remains constant. 3. Which of the following situations best demonstrates the law of demand? A. Moviegoers react to an increase in the price of a theater ticket by seeing fewer movies per year. B. Moviegoers see fewer movies per year due to an overall decrease in the quality of newly released motion pictures; C. a drought causes a decrease in the availability of pumpkins, resulting in fewer jack-o- lanterns displayed on Halloween; D. An increase in the number of people writing Economics textbooks results in a decrease in average textbook prices. 4. The explanation for the law of demand involves:
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This note was uploaded on 02/15/2010 for the course ECON 1123 taught by Professor Holmes during the Spring '08 term at The University of Oklahoma.

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Exercise 1 - Exercise 1 1. If other things constant, then...

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