In terms of indifference curves,a demand curve is generated by changes in:
A)the income effect.
B)the substitution effect.
C)the price of one good.
D)the price of both goods simultaneously.

Question

Quizplus · Accepted Answer

A demand curve is generated by changes in the price of one good, holding everything else constant. This reflects how quantity demanded of the good changes as its price varies. Indifference curves and budget constraints are used to illustrate how consumers make choices based on these price changes, but the demand curve itself is specifically about the relationship between the price of a single good and the quantity demanded of that good.

In Terms of Indifference Curves,a Demand Curve Is Generated by Changes