Final Answer:
When constructing a demand curve for product X the prices of other goods are allowed to vary thus option B is correct.
Step-by-step explanation:
When constructing a demand curve for product X, the critical factor considered is how the quantity demanded of product X changes in response to changes in its own price (Law of Demand). The correct statement is option B, "the prices of other goods are allowed to vary." This is because the demand for product X is affected not only by its own price but also by the prices of other related goods. Changes in the prices of substitutes and complements influence consumer preferences and impact the quantity demanded of product X.
Options A, C, and D are not directly related to the construction of a demand curve. Consumer preferences (Option A) may influence the shape of the demand curve, but they are not the primary variable considered. Consumer income (Option C) is typically a factor in normal and inferior goods but may not be directly related to constructing the demand curve for product X. The supply curve of product X (Option D) is not considered when constructing the demand curve as the focus is on consumer behavior and preferences.
In conclusion, option B accurately captures the relevant variable for constructing a demand curve for product X, emphasizing the impact of the prices of other goods on the quantity demanded of product X.