ECONOMICS
SCARCITY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The lower the price, the greater the demand.
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The higher the price, the lower the demand.
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The higher the price, the higher the demand.
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The lower the price, the lower the demand.
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Detailed explanation-1: -The law of demand says that rising prices reduce demand. So as prices rise, customers buy less. That’s particularly true if they can substitute cheaper goods.
Detailed explanation-2: -The law of demand states that a higher price leads to a lower quantity demanded and that a lower price leads to a higher quantity demanded.
Detailed explanation-3: -The law of demand states that when the price of a product goes up, the quantity demanded will go down – and vice versa.
Detailed explanation-4: -When demand exceeds supply, prices tend to rise. There is an inverse relationship between the supply and prices of goods and services when demand is unchanged.
Detailed explanation-5: -Demand is generally considered to slope downward: at higher prices, consumers buy less. The point at which the two curves intersect represents the market-clearing price-the price at which demand and supply are the same. Prices can change for many reasons (technology, consumer preference, weather conditions).