Question

when is there possibility of expansion-contraction of demand?

Answer 1

Answer:

Expansion of demand refers to the period when quantity demanded is more because of the fall in prices of a product. However, contraction of demand takes place when the quantity demanded is less due to rise in the price o a product.

Explanation:

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Answer 2

Answer:

Explanation:

We have studied under the law of demand that other things remaining the same, if price of a commodity rises, its demand decreases and if price of the commodity falls, its demand increases.

When quantity demanded of a commodity increases as a result of the fall in the price, it is called extension (or expansion) in demand (a movement down the demand curve) and when the quantity demanded decreases as a result of an increase in the price of the commodity, it is called contraction in demand (a movement up the demand curve). Thus, extension and contraction in demand imply change in quantity demanded due to change in the price of the commodity, other things remaining the same.