Which of the following are ways that an image (such as an advertisement or product photo) might affect the demand for a good?

• A. By directly lowering the price of the good
• B. By reducing the cost of production for the good
• C. By changing consumer preferences and increasing the perceived desirability of the good
• D. By increasing the supply of the good

Answer: (C)

Verified step by step guidance

1. Understand that demand refers to the quantity of a good that consumers are willing and able to purchase at various prices, influenced by factors such as consumer preferences, income, prices of related goods, and expectations.
2. Recognize that an image, like an advertisement or product photo, primarily affects demand by influencing consumer preferences and perceptions, making the good more desirable.
3. Note that directly lowering the price of the good or reducing the cost of production are not effects caused by an image; these relate to supply-side factors or pricing strategies.
4. Recall that increasing supply means producers are willing to sell more at each price, which is unrelated to how an image affects consumer demand.
5. Conclude that the correct way an image affects demand is by changing consumer preferences and increasing the perceived desirability of the good, thereby shifting the demand curve to the right.