Home Economy Which of The Following Is Consistent With The Law of Demand?

Which of The Following Is Consistent With The Law of Demand?

Which of the following is consistent with the law of demand?

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Which of the following is consistent with the law of demand?

Question:

Which of the following is consistent with the law of demand:

  • Refund of goods purchased 
  • Increase in compliments received for a good job
  • Increase in the purchase of goods due to a decrease in price 
  • Increase in a person’s salary resulting in more goods purchased
  • None of the above

Answer:

The increase in the quantity of goods and services purchased due to a reduction in the market price is consistent with the law of demand.

Law of Demand

The law of demand is a theory that explains the interaction between buyers and sellers for a given resource.

The law of demand states that there is a relationship between the price of a good and the buyer’s willingness to buy the good leading to an increase in sales.

As such, a buyer will have a higher willingness to purchase something when the prices are lowered by the seller.

Conversely, when the seller increases the price of a good or service, buyers will be less inclined to purchase so fewer end up buying.

Consumer Behavior

The law of demand explains how consumers behave as a function of changes in price.

If we assume that all factors affecting the demand are constant and only the price varies, an increase in price will lead consumers to purchase more.

This happens as it is less costly for consumers to make a purchase so a larger pool of consumers is willing and able to make the purchase.

Takeaways 

So, what is consistent with the laws of demand.

Typically, an increase in the price of a good or service will lead to few purchases.

Conversely, a reduction in price will lead to a higher demand for goods and services.

Let’s look at a summary of our findings.

Which of the following is consistent with the law of demand?

  • Question: What behavior is consistent with the law of demand
  • Answer: Consumers buy more with a reduction in price or they buy less with the increase in price
Consumer surplus 
Demand curve 
Diminishing marginal utility 
Law of demand
Law of supply
Law of supply and demand 
Marginal cost 
Market price
Supply and demand
Supply and demand curve
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