When we move up or down a given demand curve only price is held constant. (true or false give explaination)
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The downward-sloping demand curve reflects the price is positively related to quantity supplied. (true or false give explanation)
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| Question:When we move up or down a given demand curve only price is held constant. (true or false give explaination) Answer False When we move up or down a given demand curve, the price changes. The demand curve is a graphical illustration of changes in quantity demanded against changes in price. A movement along the demand curve whether up or down results from change in price of the commodity, while a shift of the demand curve whether to the right or left results from a change in non-price factors such as tastes and preferences.ExplanationPrice is held constant only when the demand curve is shifting to the left as a result of decrease in demand, or when the curve shifts to the right as a result of increase in demand. On the other hand, all other non-price factors are held constant when there is a movement along the demand curve. Question: The downward-sloping demand curve reflects the price is positively related to quantity supplied. (true or false give explanation) Answer False The statement is incorrect because the demand curve shows a relationship between the price and the quantity demanded and not quantity supplied.ExplanationThe demand curve is downward-sloping which indicates a negative relationship between the price and the quantity demanded for any given product. When the price of commodity X increases, customer will purchase less expensive commodity Y, which leads to a lower demand for X. The supply curve slopes upward which indicates that whenever the price of a good increases, there will be an increase in willingness and the ability of the suppliers to supply more of the good. |
