Question 2 - MCQ Questions (1 Mark) - Chapter 1 Class 7 Economics - Introduction to Demand and Supply - Economics

Last updated at April 16, 2024 by Teachoo

What is the term for a factor that affects demand, which is how much other products that are related to the product cost?

Answer:

So, the correct answer is option (C): price of related goods .

Let’s check all the options:

Option (A) Income - This is a different factor that affects demand, which is how much money consumers have to spend on products. Income affects the demand for normal goods and inferior goods differently. So, this is incorrect .
Option (B) Preferences - This is another factor that affects demand, which is what consumers like and dislike. Preferences can change due to trends, fashions, seasons, advertising, and other influences. So, this is incorrect .
Option (C) Price of related goods - Price of related goods is a factor that affects the demand for a product by changing how attractive the product is compared to other products. This is the correct term for a factor that affects demand, which is how much other products that are related to the product cost. So, this is correct .
Option (D) Market size - This is not a factor that affects demand, but a factor that affects market equilibrium. Market size is the number of buyers and sellers in a market. It affects the quantity demanded and supplied at each price. So, this is incorrect .