Question

which explains the connection between the law of demand and excess demand? the law states that decreases in price leads to greater quantity demanded and limited supply, which occurs during excess demand. the law states that increases in price increases leads to greater quantity demanded and limited supply, which occurs during excess demand. the law states that decreases in price leads to greater supply and equilibrium, which occurs during excess demand. the law states that increases in price leads to greater supply and equilibrium, which occurs during excess demand.

Explanation:

The law of demand states that, ceteris paribus, as the price of a good or service decreases, the quantity demanded increases. Excess demand occurs when quantity demanded is greater than quantity supplied at a given price. A price - decrease according to the law of demand can lead to a situation where demand outstrips supply, resulting in excess demand.

Answer:

The law states that decreases in price leads to greater quantity demanded and limited supply, which occurs during excess demand.