The idea behind the direct market experiment to measure demand is to
A) see the effects on the quantity demanded of actual variations in the price of a product.
B) use statistical methods to estimate demand curves from historical data.
C) measure demand by interviewing consumers about their buying habits and intentions.
D) measure the effect of changes in variables, such as income or taste, on price.
E) measure the effect of changes in price on quantities supplied.

Question

Quizplus · Accepted Answer

The direct market experiment involves actually varying the price of a product and measuring the resulting changes in quantity demanded. This allows for a more accurate measurement of demand than statistical methods or interviews with consumers. The other choices are not directly relevant to the direct market experiment.

The Idea Behind the Direct Market Experiment to Measure Demand