Question

cause and effect what is likely to happen when consumers hear reports that make them worry about a products safety? explain the possible effect on demand and price.

Answer 1

When consumers worry about a products safety the demand will most likely down because consumers will be less likely to buy the product and that would cause the price of the product to go down

Answer 2

Consumers buy products based on their needs and the usefulness of the product. If consumers of a product get a report that questions the safety of a product, they will question the risks associated with continued use of that product. Thus, the tendency is for consumers to decrease their purchase of that product and replace it. As demand for a product decreases, price tends to fall. This relationship is supported by the law of supply and demand, which explains that in high demand situations, prices tend to increase and in low demand situations, prices tend to decrease.