Economics
Chapter 1 Class 7 Economics - Introduction to Demand and Supply

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

A. Income

B. Preferences

C. Price of related goods

D. Market size

 

Answer:

Answer by Student

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

Detailed Explanation by Teachoo

 

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 .
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Davneet Singh

Davneet Singh has done his B.Tech from Indian Institute of Technology, Kanpur. He has been teaching from the past 14 years. He provides courses for Maths, Science, Social Science, Physics, Chemistry, Computer Science at Teachoo.