State and explain a determinant of demand for a product.

There are many possible answers, including: the price, the quality, advertising, branding, promotions, and the price and closeness of substitutes or compliments. There are also macroeconomic factors such as the real interest rate and consumer confidence.

Here is an example answer. Price: If the price for a good rises, then it is more expensive, increasing the opportunity cost of buying the good. Some consumers will value the good more than the old price but less than the new price, so the price rise will result in them deciding not to buy the good anymore. In this way, the higher the price is, the lower demand is likely to be.