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Question
Which of these is NOT an assumption of the Law of Demand?
Options
No change in the consumer's income
Consumers do not expect any change in the price of the commodity in the near future
The price of substitute remains constant
The number of firms supplying the commodity does not change
Solution
The number of firms supplying the commodity does not change
Explanation:
The Law of Demand primarily focuses on the relationship between the price of a good and the quantity demanded, assuming other factors remain constant. Assumptions of the Law of Demand include no change in consumer income, constant expectations about future prices, and constant prices of substitutes.
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RELATED QUESTIONS
What are the assumptions of the Law of Demand?
State with reason whether you agree or disagree with the following statement.
Price is the only determinant of demand.
Which is an assumption to law of demand?
| Price (in ₹) | QA (units) | QB (units) | QM (market demand)(units) |
| 10 | 4 | 5 | ______ |
| 20 | 3 | 4 | ______ |
| 30 | 2 | 3 | ______ |
| 40 | 1 | 2 | ______ |
Complete the above schedule and answer the following:
- Identify and state the underlying law.
- State four assumptions of the law.
- Draw three relevant curves based on the above schedule in one diagram.
Following is not the assumption of law of demand:
