The indifference curve in the above figure A) could illustrate ...

[Jramos095]

The indifference curve in the above figure
 
  A) could illustrate a person's preferences for identical computer disks made by two different companies.
  B) could illustrate a person's preferences for right-handed and left-handed gloves.
  C) has a marginal rate of substitution that at first decreases and then increases.
  D) None of the above statements is correct.

Question 2

List the factors change demand and shift the demand curve. Tell what happens to demand and the demand curve when there is an increase in the factor.
 
  What will be an ideal response?

[meganmoser117]

Answer to Question 1

A

Answer to Question 2

One factor that changes demand is a change in income. An increase in income increases demand and shifts the demand curve rightward for a normal good. An increase in income decreases demand and shifts the demand curve leftward for an inferior good. A change in the price of a substitute or complement also changes demand. An increase in the price of a substitute increase demand and shifts the demand curve rightward while an increase in the price of a complement decreases demand and shifts the demand curve leftward. Expectations, the population, and preferences also change demand. If people expect their income to increase, or if they expect the price of the good to be higher in the future, or if the population increases (so that the number of buyers increases), or if people's preferences for the good increase, demand increases and the demand curve shifts rightward.