Which of the following is a factor that could cause demand to decrease for certain goods during a pandemic?

• A. A decrease in consumer income due to widespread job losses
• B. An increase in the price of complementary goods
• C. A decrease in the cost of production
• D. A government subsidy for producers

Answer: (A)

Verified step by step guidance

1. Understand the concept of demand: Demand refers to the quantity of a good or service that consumers are willing and able to purchase at various prices during a given period.
2. Identify factors that shift the demand curve: Demand can decrease due to changes in non-price determinants such as consumer income, prices of related goods (complements and substitutes), consumer preferences, expectations, and population.
3. Analyze the impact of a decrease in consumer income: When consumers experience job losses, their income falls, reducing their purchasing power. For normal goods, this leads to a decrease in demand because consumers can no longer afford to buy as much.
4. Consider the effect of an increase in the price of complementary goods: If the price of a complementary good rises, the demand for the related good may decrease because the combined cost of using both goods is higher.
5. Evaluate other options: A decrease in the cost of production or a government subsidy for producers affects supply, not demand, so these factors would not directly cause a decrease in demand during a pandemic.