Question

Which of the following scenarios illustrates the law of demand?

A. A research company finds that the more expensive a particular brand of a designer handbag, the more that consumers are willing to purchase the brand.
B. Kathleen eats more steak when the price is low, and less when the price is high.
C. Francis does not care about the price of coffee at the coffee shop – he must buy two cappuccinos every day, regardless of the price.
D. John likes to drink spring water. At $2 he buys four bottles of water, and at $1.50 he still buys four bottles of water.

Answer 1

Option B is correct.

Step-by-step explanation:

In order to answer this question correctly, we first need to understand the law of demands.

Law of demands: It says that the relationship of price and quantity demanded is inversely proportional. It means if the price of a particular product goes high, then the quantity of demand will be reduced. Similarly, if the price of the product is low then the quantity of demanded will be higher.

Here,

Option B is the most relevant to the Law of Demand which says that Kathleen eats more steak when the price is low. It means when the price is low, the quantity of steak demanded is higher in Kathleen's case. Furthermore, Kathleen eats less when the price is high. It means, when the price of steak is higher then the quantity of steak demanded from Kathleen is low.

Hence, Option B is the correct option which fulfills the law of demand.