An advertising campaign for a good that succeeds in changing consumers' tastes and preferences will _____.
A) shift the demand curve for the good to the right
B) cause a movement along the demand curve for the good
C) increase demand for a competitor's product
D) make the demand for the good perfectly elastic

Question

Quizplus · Accepted Answer

When an advertising campaign successfully changes consumers' tastes and preferences in favor of a good, it increases the desire for that good among consumers. This heightened desire translates into a higher quantity demanded at each price level, effectively shifting the demand curve to the right. This is because the campaign has made the good more appealing, leading to an increase in its demand independent of price changes. Movements along the demand curve (B) occur due to price changes, not changes in tastes. Increasing demand for a competitor's product (C) would be an unintended and unlikely direct outcome of a firm's advertising efforts for its own product. Making the demand perfectly elastic (D) implies that consumers would buy any quantity at a given price, which is not a direct consequence of changing tastes and preferences through advertising.

An Advertising Campaign for a Good That Succeeds in Changing