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Questions and Answers
What is the Law of Demand?
What is the Law of Demand?
What happens to the quantity demanded when the price of a commodity decreases?
What happens to the quantity demanded when the price of a commodity decreases?
In the given example, what does the individual do when the price of the pack of soft drinks is reduced to ₹105?
In the given example, what does the individual do when the price of the pack of soft drinks is reduced to ₹105?
What is the common observation about consumer behavior and the price of a commodity?
What is the common observation about consumer behavior and the price of a commodity?
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What is the relationship between the demand and price of a commodity according to the law of demand?
What is the relationship between the demand and price of a commodity according to the law of demand?
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Study Notes
Law of Demand
- The Law of Demand states that there is an inverse relationship between the price of a commodity and the quantity demanded.
- When the price of a commodity decreases, the quantity demanded increases, and vice versa.
Effect of Price Change on Quantity Demanded
- If the price of a commodity decreases, the quantity demanded increases.
- For example, when the price of a pack of soft drinks is reduced to ₹105, the individual is likely to purchase more.
Consumer Behavior and Price
- A common observation about consumer behavior is that when the price of a commodity decreases, people tend to buy more, and when the price increases, they tend to buy less.
- This inverse relationship between the demand and price of a commodity is the foundation of the Law of Demand.
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Description
Test your understanding of the Law of Demand with this quiz. Learn about the inverse relationship between price and quantity demanded, and see examples of how it applies in real-world scenarios.
