If the price of movies on DVD rises while the price of movies purchased on demand through the Internet remains the same, the law of demand predicts that consumers will:
A) substitute movies on DVD for movies on the Internet.
B) substitute movies on the Internet for movies on DVD.
C) buy only movies on DVD.
D) buy only movies on the Internet.

Question

Quizplus · Accepted Answer

The law of demand states that as the price of a good rises, consumers will tend to buy less of it and substitute it with a cheaper alternative. Therefore, if the price of DVDs rises, consumers will likely substitute them with movies on the Internet, whose price remains the same.

If the Price of Movies on DVD Rises While the Price