Sales of national brands of orange juice tend to increase when the economy is doing well,while sales of generic orange juice increase when the economy is not doing well.This is an example of how _______ impacts demand for products.

Question

Quizplus · Accepted Answer

The scenario described is an example of the income effect, where changes in consumers' income levels impact the demand for different types of orange juice. When the economy is doing well, consumers have more disposable income and are more likely to purchase higher-priced national brands. Conversely, when the economy is not doing well, consumers have less disposable income and are more likely to purchase lower-priced generic alternatives. This phenomenon is often observed across a variety of product categories.

Sales of National Brands of Orange Juice Tend to Increase