"In 2008,air travel decreased substantially,despite significant reductions in ticket prices." If this information is correct,it indicates that the law of demand did not apply to air travel in 2008.

Question

Quizplus · Accepted Answer

The law of demand states that as the price of a good or service decreases, demand for that good or service increases, ceteris paribus. Therefore, if ticket prices decreased in 2008 and air travel still decreased, it would suggest that the law of demand did not apply. However, the statement also mentions "significant reductions in ticket prices," which implies that the price decreases were not enough to offset other factors that may have reduced demand for air travel, such as the economic recession or concerns about travel safety. Therefore, the law of demand may still have applied, but there were other factors at play that impacted demand.

"In 2008,air Travel Decreased Substantially,despite Significant Reductions in Ticket Prices