In microeconomics, what does a demand curve show?

• A. The relationship between the price of a good and the quantity supplied over a given period, holding other factors constant
• B. The relationship between consumers' income and the quantity demanded at a fixed price
• C. The total revenue a firm earns at each level of output
• D. The relationship between the price of a good and the quantity demanded over a given period, holding other factors constant

Answer: (D)

Verified step by step guidance

1. Understand that a demand curve graphically represents how much of a good consumers are willing and able to purchase at different prices over a specific period.
2. Recognize that the demand curve typically slopes downward, indicating an inverse relationship between price and quantity demanded — as price decreases, quantity demanded increases, and vice versa.
3. Note that the demand curve holds other factors constant (ceteris paribus), such as consumer income, tastes, and prices of related goods, to isolate the effect of price on quantity demanded.
4. Distinguish the demand curve from the supply curve, which shows the relationship between price and quantity supplied, and from other concepts like total revenue or income effects.
5. Summarize that the demand curve specifically shows the relationship between the price of a good and the quantity demanded over a given period, holding other factors constant.