How will consumers generally react to an increase in the price of butter?
A) They will purchase a larger quantity of butter.
B) They will substitute other goods like margarine for the more expensive butter.
C) They will reduce their purchases of substitute goods like margarine.
D) They will continue purchasing the same quantity of butter at the higher price.

Question

Quizplus · Accepted Answer

When the price of butter increases, consumers are likely to substitute it with cheaper alternatives like margarine, reducing their butter purchases.

How Will Consumers Generally React to an Increase in the Price