In introductory microeconomics, a demand curve shows the relationship between which two variables (holding other factors constant)?

• A. Consumers' tastes and the number of firms in the market
• B. The price of the good and consumers' income
• C. The quantity supplied of the good and the price of an input
• D. The price of the good and the quantity demanded of the good

Answer: (D)

Verified step by step guidance

1. Understand that a demand curve in microeconomics represents the relationship between two main variables: the price of a good and the quantity demanded of that good, while holding other factors constant (ceteris paribus).
2. Recognize that the demand curve typically slopes downward, indicating that as the price of the good decreases, the quantity demanded increases, and vice versa.
3. Identify that other factors such as consumers' tastes, income, or the number of firms in the market are held constant when analyzing the demand curve, so they are not the variables shown on the curve itself.
4. Recall that the demand curve does not show the relationship between quantity supplied and price of inputs, as that pertains to supply, not demand.
5. Conclude that the correct variables depicted on a demand curve are the price of the good (on the vertical axis) and the quantity demanded of the good (on the horizontal axis).