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Questions and Answers
What is assumed to be constant under the law of demand?
What is assumed to be constant under the law of demand?
- Quantity demanded
- Income of consumers
- Price of the good
- Prices of related commodities, income of consumers, tastes and preferences of consumers, and all other factors (correct)
What is the relationship between price and quantity demanded according to the law of demand?
What is the relationship between price and quantity demanded according to the law of demand?
- Constant
- Direct
- Inverse (correct)
- Variable
What happens to the quantity demanded when the price of a good rises?
What happens to the quantity demanded when the price of a good rises?
- It becomes unstable
- It increases
- It remains constant
- It decreases (correct)
Who defined the law of demand as 'The greater the amount to be sold, the smaller must be the price at which it is offered'?
Who defined the law of demand as 'The greater the amount to be sold, the smaller must be the price at which it is offered'?
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What is the condition under which the inverse price-demand relationship may not hold good?
What is the condition under which the inverse price-demand relationship may not hold good?
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What is the law of demand primarily concerned with?
What is the law of demand primarily concerned with?
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