A typical demand curve shows that:
A) as people earn more income, they buy more of a good.
B) as supply increases, the amount purchased decreases.
C) people tend to buy more of a good than they really want.
D) people tend to buy more of a good when its price decreases.

Question

Quizplus · Accepted Answer

A typical demand curve shows an inverse relationship between price and quantity demanded, meaning that as the price of a good decreases, people tend to buy more of it (and vice versa). Therefore, option D is the correct answer. Option A is incorrect as it discusses income, not price, and option C is incorrect as it implies that people are irrational in their purchasing behavior. Option B is incorrect as it refers to the supply side of the market, not the demand side.

A Typical Demand Curve Shows That