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The Law of Demand, assuming other things to remain constant, establishes the relationship between :
- a)income of the consumer and the quantity of a good demanded by him.
- b)price of a good and the quantity demanded.
- c)price of a good and the demand for its substitute.
- d)quantity demanded of a good and the relative prices of its complementary goods.
Correct answer is option 'B'. Can you explain this answer?
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The Law of Demand, assuming other things to remain constant, establish...
Law of Demand: Relationship between Price and Quantity Demanded
The Law of Demand is a fundamental concept in economics that explains the relationship between the price of a good or service and the quantity of that good or service that consumers are willing and able to purchase. It assumes that all other factors influencing demand, such as income, tastes and preferences, and prices of related goods, remain constant.
Explanation:
1. Law of Demand:
The Law of Demand states that as the price of a good or service increases, the quantity demanded of that good or service decreases, and vice versa, assuming all other factors remain constant. In other words, there is an inverse relationship between price and quantity demanded.
2. Relationship between Price and Quantity Demanded:
The correct answer to the given question is option 'B', which states that the Law of Demand establishes the relationship between the price of a good and the quantity demanded. Here's why:
- Price is one of the most influential factors affecting the demand for a good or service. When the price of a good decreases, consumers are more willing and able to purchase it because it becomes relatively cheaper compared to other goods or services. On the other hand, when the price of a good increases, consumers tend to reduce their demand for it, as it becomes relatively more expensive.
- The quantity demanded refers to the amount or number of goods or services that consumers are willing and able to purchase at a given price. As the price of a good decreases, the quantity demanded typically increases, and as the price of a good increases, the quantity demanded usually decreases.
- This relationship can be represented by a demand curve, which is downward sloping from left to right. The demand curve shows the quantity demanded at each possible price, holding all other factors constant. It illustrates the Law of Demand, as it demonstrates the inverse relationship between price and quantity demanded.
Conclusion:
In conclusion, the Law of Demand establishes the relationship between the price of a good and the quantity demanded. As the price of a good increases, the quantity demanded decreases, and as the price of a good decreases, the quantity demanded increases. This relationship is fundamental in understanding consumer behavior and market dynamics.
The Law of Demand is a fundamental concept in economics that explains the relationship between the price of a good or service and the quantity of that good or service that consumers are willing and able to purchase. It assumes that all other factors influencing demand, such as income, tastes and preferences, and prices of related goods, remain constant.
Explanation:
1. Law of Demand:
The Law of Demand states that as the price of a good or service increases, the quantity demanded of that good or service decreases, and vice versa, assuming all other factors remain constant. In other words, there is an inverse relationship between price and quantity demanded.
2. Relationship between Price and Quantity Demanded:
The correct answer to the given question is option 'B', which states that the Law of Demand establishes the relationship between the price of a good and the quantity demanded. Here's why:
- Price is one of the most influential factors affecting the demand for a good or service. When the price of a good decreases, consumers are more willing and able to purchase it because it becomes relatively cheaper compared to other goods or services. On the other hand, when the price of a good increases, consumers tend to reduce their demand for it, as it becomes relatively more expensive.
- The quantity demanded refers to the amount or number of goods or services that consumers are willing and able to purchase at a given price. As the price of a good decreases, the quantity demanded typically increases, and as the price of a good increases, the quantity demanded usually decreases.
- This relationship can be represented by a demand curve, which is downward sloping from left to right. The demand curve shows the quantity demanded at each possible price, holding all other factors constant. It illustrates the Law of Demand, as it demonstrates the inverse relationship between price and quantity demanded.
Conclusion:
In conclusion, the Law of Demand establishes the relationship between the price of a good and the quantity demanded. As the price of a good increases, the quantity demanded decreases, and as the price of a good decreases, the quantity demanded increases. This relationship is fundamental in understanding consumer behavior and market dynamics.
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The Law of Demand, assuming other things to remain constant, establishes the relationship between :a)income of the consumer and the quantity of a good demanded by him.b)price of a good and the quantity demanded.c)price of a good and the demand for its substitute.d)quantity demanded of a good and the relative prices of its complementary goods.Correct answer is option 'B'. Can you explain this answer?
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