ECONOMICS
SCARCITY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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go down
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go up
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stay the same
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neither
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Detailed explanation-1: -It’s a fundamental economic principle that when supply exceeds demand for a good or service, prices fall.
Detailed explanation-2: -Economists call this situation an “excess supply” – that is the quantity demanded is less than the quantity supplied at the given price. This is also called a surplus.
Detailed explanation-3: -If the price decreases, quantity demanded increases. This is the Law of Demand. On a graph, an inverse relationship is represented by a downward sloping line from left to right.
Detailed explanation-4: -Law of demand is a fundamental principle of Economics, it states that quantity demanded is always inversely related to the price of the goods. In other words, with increase in price, quantity demanded will be less and vice versa.