According to the Law of Demand, the demand curve for a good will OA. slope downw
ID: 1110869 • Letter: A
Question
According to the Law of Demand, the demand curve for a good will OA. slope downward. O B. shift rightward when the price of the good increases. O C. slope upward O D. shift leftward when the price of the good increases the demand curve for a good wil An increase in the price of a good will lead to A. a leftward shift of the demand curve for that good. O B. a rightward shift of the demand curve for that good ( C. a movement up along the demand curve for that good D. a movement down along the demand curve for that good An increase in consumer's income will lead to: A, a movement upward along the demand curve for a normal good ( B, a rightward shift of the demand curve for a normal good. O C. a rightward shift of the supply curve for a normal good. ( D. no change of the demand curve for a normal good.Explanation / Answer
1. According to the law of demand, the demand curve for a good will slope downward. This is because according to law of demand, there is an negative relationship between change in price and change in the quantity demanded. Note that the price is not a determinant of demand curve, so change in the price of good will cause movement along the demand curve and it will not cause any shift of demand curve.
Answer- option A
2. Price is not a determinant of demand curve so, a change in price will not shift the demand curve but will cause a movement along the demand curve. An increase in price will cause movement up along the demand curve as when price increases, quantity demanded decreases(price is on vertical axis and quantity is on horizontal axis and the demand curve is downward sloping).
Answer- option C
3. Normal goods are goods for which demand increases when income increases. So, an increase in consumer income will shift the demand curve rightward for a normal good as the demand increases. Here income is a determinant of the demand curve.
Answer- option B
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