Question : Which of the following is the assumption of the law of demand? A: The commodity's price should not change. B: The quantity requested should not change. C: Substitute prices should not change.
Option 1: Only A correct
Option 2: B and C are correct
Option 3: Only C correct
Option 4: A, B, and C all are correct.
Correct Answer: Only C correct
Solution : According to the law of demand, if all other factors remain constant (cetris peribus), the price and quantity demand of any good or service are inversely related. When the price of a product rises, so does the demand for the same product. Hence substitute prices should not change.
Question : Because of the following, an individual demand curve slopes downward to the right: A: The application of the law of diminishing marginal utility B: The substitution effect of a price decrease C: Income impact of price decrease
Question : Law of Demand states that there is a negative relationship between ______.
Question : Assertion: When the price of a good decrease, its quantity demanded increases. Reason: The law of demand states an inverse relationship between price and quantity demanded.
Question : Assertion: When the price of a good decreases, its quantity demanded increases.
Reason: The law of demand states an inverse relationship between price and quantity demanded.
Question : Assertion: When the price of a product decreases, its quantity demanded increases.
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