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Why does demand curve slop downward?( numerical eg)
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Why does demand curve slop downward?( numerical eg)
reasons for downward sloping of demand curve1) real income of consumer 2) substitution effect3)alternative uses of goods4)law of DMU5)no. of consumers
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Why does demand curve slop downward?( numerical eg)
well there are three basic reason for downward slope of demand curve.First is the income effect.When price drop or fall people can buy more or less of a good for the same amount of money.Second is the substitution effect.If consumer dont see meaningful difference between products they'll buy the one with lowest price so a price increase will drive them toward substitutes while a reduction will draw them in.Third is the concept of diminishing marginal utility. If u already have plenty of something u have less of a need to buy more of it.now lets understand downward sloping of demand curve with the help of a table:-price quantity demanded 5 14 2 3 32 4 1 5 This table clearly shows that more and more units of commodity are demanded when price of the commodity falls.When u draw this table u ll find that the demand curve slopes downward from left to right indicating an inverse relationship between price and quantity demanded.
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Why does demand curve slop downward?( numerical eg)
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