Question

Which of the following is a determinant of market demand?

Options

• Taste and preferences

• Consumer Credit Facility

• Income of the consumer

• Government policy

Answer 1

Consumer Credit Facility

Explanation:

While an individual’s choices are influenced by personal income and choices, the widespread availability of credit facilities has a direct impact on aggregate market demand. When banks expand credit possibilities, they increase the purchasing power of the entire population, allowing a large number of consumers to make large purchases at once.