For most goods,demand curves slope downward because:

Question

Quizplus · Accepted Answer

The substitution effect is the main reason why demand curves slope downward. As the price of a good increases, consumers will substitute it with other similar but less expensive goods, causing the quantity demanded to decrease. This substitution effect always causes quantity demanded and price to be inversely related, leading to a downward-sloping demand curve. The income effect can also influence demand, but it does not always lead to an inverse relationship between price and quantity demanded.

For Most Goods,demand Curves Slope Downward Because