1 Answer | Add Yours
If you are talking about aggregate demand for all products, the most important determinant is consumer income. If you are talking about the demand for a specific product, both income and consumer preferences are important.
If we are talking about the demand for one particular product (let's say a certain brand of clothing) income and tastes are important. Consumers will only buy the clothes if they have enough money. But they will also only buy the clothes if they like them. This means both tastes and income are important.
If we are talking about aggregate demand, consumer income is most important. If people have money, they will presumably buy more goods and services in general regardless of their individual tastes.
We’ve answered 319,195 questions. We can answer yours, too.Ask a question