What is the expected effect on your demand for goods if both your income and the prices of those goods double?

Multiple choice question for Supply and Demand. Select an option, then review the explanation below.

Explanation

If your income and the prices of the goods you purchase both double, your purchasing power remains unchanged, so your demand for these goods is likely to stay the same.

Practice related questions from the same subject.

1.What is the typical shape of a demand curve?
2.What term describes a company earning profits beyond its normal profit level?
3.How does an increase in marginal cost affect output, and how does an increase in marginal revenue impact output?
4.Marginal revenue refers to the ________ resulting from producing an additional ________ of output.
5.What are firms generally assumed to do with their costs and profits?

What is the expected effect on your demand for goods if both your income and the prices of those goods double?

Explanation

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