Multiple Choice
When quantity demanded decreases in response to a change in price, which of the following has occurred?
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3. The Market Forces of Supply and Demand
The Demand Curve
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Join thousands of students who trust us to help them ace their exams!Watch the first videoMultiple Choice
A demand curve shows the ______.
A
cost of producing a good at different output levels
B
relationship between the price of a good and the quantity supplied
C
total revenue earned by producers at different prices
D
relationship between the price of a good and the quantity demanded
Verified step by step guidance1
Understand the definition of a demand curve: it graphically represents how much of a good consumers are willing and able to purchase at different prices.
Recall that the demand curve plots the relationship between the price of a good (on the vertical axis) and the quantity demanded (on the horizontal axis).
Recognize that the demand curve typically slopes downward, indicating that as price decreases, quantity demanded increases, and vice versa.
Differentiate the demand curve from other curves such as the supply curve, which shows the relationship between price and quantity supplied, or cost curves, which relate to production costs.
Conclude that the demand curve specifically shows the relationship between the price of a good and the quantity demanded, making this the correct interpretation.
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