Century 21 Accounting: General Journal
11th EditionClaudia Bienias Gilbertson, Debra Gentene, Mark W Lehman
1,012 solutions
Statistical Techniques in Business and Economics
15th EditionDouglas A. Lind, Samuel A. Wathen, William G. Marchal
1,236 solutions
Principles of Economics
8th EditionN. Gregory Mankiw
1,335 solutions
Essentials of Investments
9th EditionAlan J. Marcus, Alex Kane, Zvi Bodie
689 solutions
Suggest a new Definition
Proposed definitions will be considered for inclusion in the Economictimes.com
(##include msid=4006719,type=11 ##)
Definition: The law of demand states that other factors being constant (cetris peribus), price and quantity demand of any good and service are inversely related to each other. When the price of a product increases, the demand for
the same product will fall.
Description: Law of demand explains consumer choice behavior when the price changes. In the market, assuming other factors affecting demand being constant, when the price of a good rises, it leads to a fall in the demand of that good. This is the natural consumer choice behavior. This happens because a consumer hesitates to spend more for the good with the fear of going out of cash.
The above diagram shows the demand curve which is downward sloping. Clearly when the price of the commodity increases from price p3 to p2, then its quantity demand comes down from Q3 to Q2 and then to Q3 and vice versa.
Learn more about the Law of Demand..
PREV DEFINITION
NEXT DEFINITION
Related News
The law of demand states that the quantity of a good demanded variesA)inversely with its price.B)inversely with the price of substitute goods.C)directly with income.D)directly with population.Answer: A
Which of the following is consistent with the law of demand?
The law of demand implies that if nothing else changes, there is
Which of the following influences people’s buying plans and varies moving along a demand curve?
The law of demand states thatA)an increase in the price of a good shifts the demand curve leftward.B)a decrease in the price of a good shifts the demand curve leftward.C)other thing remaining the same, the higher the price of a good, the larger is the quantitydemanded.D)other things remaining the same, the higher the price of a good, the smaller is the quantitydemanded.Answer: D
The law of demand implies that demand curves
Each point on the demand curve reflects
A drop in the price of a compact disc shifts the demand curve for pre recorded tapes leftward. Fromthat you know compact discs and pre recorded tapes are