Learning Path
Question & Answer1
Understand Question2
Review Options3
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Explore TopicChoose the Best Answer
A
True
B
False
Understanding the Answer
Let's break down why this is correct
Answer
When a price goes up, most people buy less of the item because it costs more, so the quantity demanded usually falls. However, this rule is not absolute. Some products, like high‑end watches or luxury cars, are seen as better or more desirable when they are expensive, so people may actually buy more as the price rises. In other cases, a price hike can signal better quality or scarcity, encouraging more purchases. Thus, while price increases often lower demand, other factors can cause the opposite effect.
Detailed Explanation
The law of demand says price and quantity demanded move opposite ways, but other things can change that. Other options are incorrect because The misconception is that price changes always reduce demand.
Key Concepts
Demand
Supply
Price Elasticity
Topic
Demand and Supply Basics
Difficulty
easy level question
Cognitive Level
understand
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