Question

Identify and Explain the concept from the given illustration.

1. As ice cream of Rs. 50/- was available for Rs. 40/-, Ramesh demanded four ice

creams instead of three​

Answer 1

Answer:

g

Explanation:

Answer 2

Ice cream of Rs 50 was available for Rs 40, Ramesh demanded four ice creams instead of three this statement represents ‘the law of demand.’

• ‘The law of Demand’ states that when the price of goods and services is increased, it would result in a decrease in quantity demand for the given goods and services, and when the price of goods and services decreases this would result in an increase in quantity demand of the given goods and services.

• As price and Quantity demanded has an inverse relation, the demand curve is a downward-sloping curve.

• The law of demand represents:

1. The direction of the demand curve with respect to changes in the price.
2. An inverse relation between price and quantity demanded.
3. It represents one-sided relation as it shows the change in quantity demand with respect to changes in price and not vice versa.
4. It shows the relationship between price and quantity demanded, keeping other factors constant.

• In the given statement, when the price of ice cream decreases from Rs 50 to Rs 40, The quantity demanded of ice cream increases from 3 units to 4 units. Which shows an expansion in the demand curve.

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