ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Economists call this the Law of Demand. If the price goes up, the quantity demanded goes down (but demand itself stays the same). If the price decreases, quantity demanded increases.

Detailed explanation-2: -If price elasticity is greater than 1, the good is elastic; if less than 1, it is inelastic. If a good’s price elasticity is 0 (no amount of price change produces a change in demand), it is perfectly inelastic.

Detailed explanation-3: -Inelastic demand is when a buyer’s demand for a product does not change as much as its change in price. When price increases by 20% and demand decreases by only 1%, demand is said to be inelastic. This situation typically occurs with everyday household products and services.

Detailed explanation-4: -For most products and services, increased price results in demand for fewer products.