Asked by Natcha Channara on May 02, 2024
Verified
Referring to the Economics in Practice on page 320: A successful celebrity endorsement of a product will likely shift the demand curve for the product to the ________, resulting in ________ in the equilibrium price of the item.
A) right; an increase
B) right; a decrease
C) left; an increase
D) left; a decrease
Celebrity Endorsement
The practice of using a famous person's support or approval to promote a product or service, leveraging their influence to reach potential customers.
Demand Curve
A graphical representation showing the relationship between the price of a good or service and the quantity demanded by consumers at various price levels.
Equilibrium Price
The market price at which the quantity demanded of a product equals the quantity supplied, leading to a stable market condition.
- Comprehend the significance and controversies of advertising in monopolistically competitive market environments.
Verified Answer
KG
Kristen GilrayMay 08, 2024
Final Answer :
A
Explanation :
A successful celebrity endorsement typically increases the desirability of a product, leading to higher demand. As demand increases (shifts to the right), the equilibrium price of the product also increases due to higher demand outpacing supply.
Learning Objectives
- Comprehend the significance and controversies of advertising in monopolistically competitive market environments.