We have seen already that demand curves (price Demand) slope downwards from left to right. Since demand curve is only a geometrical representation of the law of demand with 'quantity' on the X axis, and 'price' on the Y axis, the shape of the demand curve has to be necessarily of one sloping downwards showing that more is demanded at a lower price. The question why does the demand curve slope downwards is an indirect way of asking why does the law of demand operate. What are the reasons behind the operation of law of demand? why do people demand more if price comes down? So it is better to discuss the reasons behind the law of demand or the economics of law of demand in order to understand the question under discussion.
Demand curve is negatively sloped
The demand curve generally slopes downward from left to right. It has a negative slope because the two important variables price and quantity work in opposite direCtion. As the price of a commodity decreases, the quantity demanded increases over a specified period of time and vice versa, other things remaining constant. The fundamental reasons for demand curve to slope downward aFe as follows:
(i) Law of diminishing marginal utility. The law of demand is based on the law of diminishing marginal utility. According to the cardinal utility approach, when a consumer purchases more units of a commodity, its marginal utility declines. The consumer, therefore, will purchase more units of that cOmmodity only if its price falls.
Thus, a decrease in price- brings about an increase, in demand. The demand curve, therefore, is downward sloping.
(ii) Income effect. Other things being equal, when the price of a commodity decreases, the real income or the purchasing power of the household increases. The consumer is now in a position to. purchase more commodities with the same income. The demand for a commodity thus increases not only from the existing buyers but also from the new buyers who were earlier unable to purchase at higher price. When at a lower price, there is a greater demand for a commodity by the households" the demand curve is bound to slope downward from left to right.
(iii) Substitution effect. The demand curve slopes downward from left to right also because of the substitution effect. For instance, the price of meat falls and the prices of other substitutes say poultry and beef remain constant. Then the households would prefer to purchase meat because it is now relatively cheaper. The increase in demand with a fall in the price of meat will move the demand curve downward from left to right.
(iv) Entry of new buyers. When the price of a commodity falls, its demand not only increases from the old buyers but the new buyers also enter the market. The combined result of the .income and substitution effect is that demand extends, ceteris paribus, as the price falls. The demand curve slopes downward from left to right.
Because as the price goes up, people demand less, thus, the demand curve as a negative slope.
Downward
Is always negative. (should be in all caps for emphasis)
Demand curve is slope downward because of inverse relationship between price and quantity.
A demand curve slopes downward left to right because the relationship between price and demand is negative - as price drops demand rises. The opposite is true for a supply curve where as price rises supply rises - the relationship is positive so the supply curve slopes upward from left to right. Nova net answer- because demand decreases as price increases
The demand curve will have a downward slope indicating ________ . A. the expansion of demand with a fall in price B. contraction of demand with a rise in price C. the expansion of demand with a fall in price and contraction of demand with a rise in price D. rise in price causes a rise in supply
Downward
Is always negative. (should be in all caps for emphasis)
Demand curve is slope downward because of inverse relationship between price and quantity.
A demand curve slopes downward left to right because the relationship between price and demand is negative - as price drops demand rises. The opposite is true for a supply curve where as price rises supply rises - the relationship is positive so the supply curve slopes upward from left to right. Nova net answer- because demand decreases as price increases
A demand curve slopes downward left to right because the relationship between price and demand is negative - as price drops demand rises. The opposite is true for a supply curve where as price rises supply rises - the relationship is positive so the supply curve slopes upward from left to right. Nova net answer- because demand decreases as price increases
The demand curve will have a downward slope indicating ________ . A. the expansion of demand with a fall in price B. contraction of demand with a rise in price C. the expansion of demand with a fall in price and contraction of demand with a rise in price D. rise in price causes a rise in supply
The principle of diminishing marginal utility explains the slope of the demand curve by letting us be able to see which direction the slope is in, which is always downward.
Price elasticity of demand is equal to the instantaneous slope of the demand curve, or the slope of the tangent line at any point on the demand curve. So if the demand curve is represented by a straight downward sloping line, then yes, price elasticity of demand is equal to the slope of the demand curve. Otherwise, the slope at any point on the curve is changing, and you can find the it by taking the derivative of the demand curve function, which will find the Price elasticity of demand at any single point. Thus, the Price Elasticity of Demand changes at different points on the demand curve.
indifference curves slopes downward to the right
because demand decreases as price increases :)
due to negative slope
It is a slope that goes downwards from left to right.