Question

select all the correct answers.
which statements are true according to the law of demand?

an increase in supply leads to an increase in demand.

a decrease in supply leads to a decrease in demand.

an increase in price leads to a decrease in quantity demanded.

a decrease in price leads to an increase in quantity demanded.

an increase in price leads to an increase in demand.

Explanation:

The law of demand states that, ceteris paribus (all other things being equal), as the price of a good or service increases, the quantity demanded of that good or service decreases, and as the price decreases, the quantity demanded increases. Statements about supply affecting demand are not part of the law of demand (supply and demand are related but the law of demand focuses on price - quantity demanded relationship). The statement "An increase in price leads to an increase in demand" is contrary to the law of demand. So the correct statements are those about price and quantity demanded: "An increase in price leads to a decrease in quantity demanded" and "A decrease in price leads to an increase in quantity demanded".

Answer:

C. An increase in price leads to a decrease in quantity demanded, D. A decrease in price leads to an increase in quantity demanded