The relationship between price expectations and demand is
A)negative; when future prices are expected to rise, current demand will fall.
B)negative; when future prices are expected to fall, current demand will rise.
C)positive; when future prices are expected to rise, current demand will rise.
D)positive; future prices are generally expected to rise.

Question

Quizplus · Accepted Answer

The relationship is positive because if consumers expect prices to rise in the future, they are more likely to purchase goods now to avoid higher costs later, thus increasing current demand.

The Relationship Between Price Expectations and Demand Is