Association of Chartered Certified Accountants (ACCA) Certification Practice Test

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Which factor does NOT influence the demand for fashion goods?

Consumer preferences
Supply-side factors
Trends and styles
Practical utility

The correct answer is: Supply-side factors

The demand for fashion goods is primarily influenced by various consumer-centric factors and the current trends in the market. Consumer preferences play a significant role as fashion is largely driven by the tastes and desires of individuals. Trends and styles are essential in shaping what is considered fashionable at any given time, as they often dictate what consumers want to buy. Practical utility can also impact demand, particularly when consumers are considering the functionality of fashion items, but it is not the primary driver in the fast-changing world of fashion, where aesthetic and social factors often take precedence. In this context, supply-side factors, which pertain to the production side of the economy (such as manufacturing capabilities, supplier relationships, and costs), do not directly influence consumer demand. While supply may affect availability and pricing, it is the consumer's desire and willingness to purchase that predominantly sets demand levels. Hence, supply-side factors are not a determinant of demand for fashion goods.