If Pepsi increases its prices which of the following would NOT happen?

A) The demand for Pepsi would drop.
B) The quantity demanded of Pepsi would drop.
C) The demand for Coke would increase.
D) The equilibrium price of Coke would rise.
E) The equilibrium quantity of Coke would rise.

Question

Chris Grecco · Accepted Answer

Final Answer : A, Explanation :  When Pepsi increases its prices, it does not directly cause the demand curve for Pepsi to shift; rather, it leads to a movement along the demand curve, indicating a decrease in the quantity demanded of Pepsi, not a decrease in demand itself. Demand refers to the relationship between price and the quantity consumers are willing to buy at each price level, whereas quantity demanded refers to the specific amount consumers are willing to buy at a particular price. Changes in factors other than the price of the good itself (such as consumer preferences, income, prices of related goods) are what cause the demand curve to shift.

If Pepsi increases its prices which of the following would NOT happen?

A) The demand for Pepsi would drop.
B) The quantity demanded of Pepsi would drop.
C) The demand for Coke would increase.
D) The equilibrium price of Coke would rise.
E) The equilibrium quantity of Coke would rise.

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Learning Objectives

Related questions

If Pepsi increases its prices which of the following would NOT happen?A) The demand for Pepsi would drop.B) The quantity demanded of Pepsi would drop.C) The demand for Coke would increase.D) The equilibrium price of Coke would rise.E) The equilibrium quantity of Coke would rise.

Definitions

Learning Objectives

Learning Objectives

Related questions

If Pepsi increases its prices which of the following would NOT happen?

A) The demand for Pepsi would drop.
B) The quantity demanded of Pepsi would drop.
C) The demand for Coke would increase.
D) The equilibrium price of Coke would rise.
E) The equilibrium quantity of Coke would rise.