If the quantity demand for a product suddenly increases in response to a reduction in price or if the quantity demanded decreases after a price increases it is said that consumers are responding to?

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Nathen Duffy

Social Studies

13 July, 16:39

If the quantity demand for a product suddenly increases in response to a reduction in price or if the quantity demanded decreases after a price increases it is said that consumers are responding to?

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Marianna · Answer 1

The law of demand states that, if all other factors remain equal, the higher the price of a good, the less people will demand that good. In other words, the higher the price, the lower the quantity demanded. The amount of a good that buyers purchase at a higher price is less because as the price of a good goes up, so does the opportunity cost of buying that good. As a result, people will naturally avoid buying a product that will force them to forgo the consumption of something else they value more. The chart below shows that the curve is a downward slope.