The "other things being equal" clause in the law of demand does allow which of the following factors to change?
A) Consumer income.
B) The prices of other goods.
C) Consumer tastes and preferences.
D) The price of the good being demanded.

Question

The "other things being equal" clause in the law of demand does  allow which of the following factors to change?
A) Consumer income.
B) The prices of other goods.
C) Consumer tastes and preferences.
D) The price of the good being demanded.

Quizplus · Accepted Answer

The "other things being equal" clause implies that all other factors except the price of the good being demanded are constant. Hence, the price of the good being demanded is allowed to change while all other factors remain constant. However, changes in consumer income, prices of other goods, and consumer tastes and preferences can shift the demand curve, but that would be a change in the "other things" and not because of the price of the good itself.

The "Other Things Being Equal" Clause in the Law of Demand