Which of the Following Most Correctly States the Law of Demand

question 237

Multiple Choice

Which of the following most correctly states the law of demand?

• A) As the price falls all other things unchanged, demand will go up.
• B) As the price goes up, all other things unchanged, demand will go down.
• C) As the price falls, all other things unchanged, the quantity demanded will go down.
• D) As the price falls, all other things unchanged, the quantity demanded will increase.

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Definitions:

Support Price

A price level set by governments in order to stabilize or increase prices of specific goods by buying up the supply or providing subsidies.

Demand Curve

A graphical representation showing the relationship between the price of a good and the amount of that good consumers are willing to buy.

Support Price

A price level set by governments in order to maintain the market price of a good or service at a particular minimum level to protect producers.

Consumer Surplus

The difference between what consumers are willing to pay for a good or service versus what they actually pay, measuring the benefit to consumers from participation in the market.