The demand function recognizes that the quantity of a good consumed depends on:

Question

Quizplus · Accepted Answer

The demand function takes into account both the demand shifters (such as income, preferences, and advertising) and price, as these are the two main factors that influence the quantity of a good consumed. The prices of other goods (A) and supply shifters (B) are not directly related to the demand for a specific good, and therefore do not belong in the demand function. Demand shifters alone (D) do not capture the full relationship between price and quantity demanded, and thus the correct answer is C.

The Demand Function Recognizes That the Quantity of a Good