In microeconomics, what does a market demand curve show?

• A. The total quantity of a good that all consumers in a market are willing and able to buy at each possible price, holding other factors constant
• B. The market price that equates quantity demanded and quantity supplied for all possible income levels
• C. The quantity of a good that a single consumer is willing and able to buy at each possible price, holding other factors constant
• D. The relationship between the price of a good and the quantity producers are willing and able to sell at each price

Answer: (A)

Verified step by step guidance

1. Understand that a market demand curve represents the behavior of all consumers in a market combined, not just a single consumer.
2. Recall that the demand curve shows the relationship between the price of a good and the quantity demanded, holding other factors constant (ceteris paribus).
3. Recognize that the market demand curve aggregates individual demand curves horizontally by summing the quantities demanded by all consumers at each price level.
4. Note that the market demand curve focuses on quantities consumers are willing and able to buy, not on quantities producers supply or on equilibrium prices.
5. Conclude that the market demand curve shows the total quantity of a good that all consumers in a market are willing and able to buy at each possible price, holding other factors constant.