A higher price reduces the quantity demanded for a product because
A) the purchasing power of individuals increases.
B) the ﬁnancial assets of individuals increase.
C) individuals will buy more of the product and less of its substitutes.
D) individuals can afford less of the product and will switch to substitutes.

Question

Quizplus · Accepted Answer

A higher price would mean that individuals can afford less of the product, which will make them switch to substitutes, reducing the quantity demanded for the product.

A Higher Price Reduces the Quantity Demanded for a Product