Question

What is the law of demand?

a tendency for consumers to buy more of a good when its price decreases and less when its price increases


the desire to own something and the ability to pay for it


a table that lists the quantity of a good all consumers in a market will buy at each different price


a table that lists the quantity of a good a person will buy at each different price

Answer 1

The correct answer is a) A tendency for consumers to buy more of a good when its price decreases and less when its price increases

Step-by-step explanation:

A classical definition of the law of demand in microeconomics states that the the demand for a good rises when it's price is lowered, while the demand for a product decreases if the price increases - assuming all other factors are constant.

While pretty simple at it's core, the theory sets the basis for how a simple economic system works.

For corporations, the basic theory dictates how to price a product, how to increase sales and ensure better profits.

For government, it can show how the economic might stagnant if there is too much inflation.