Question

Demand curves usually slopes
a. Downward to the left
b. Downward to the right
c. Either way is just as likely
d. Straight upwards

Answer 1

Option b. Downward to the right

Demand curves usually slopes downward to the right indicating a large quantity demanded at lower prices and small quantity demanded at higher prices. This is explained by law of demand. The law of demand states that other factors being constant, as the price of a good increases, quantity demanded decreases; conversely, as the price of a good decreases, quantity demanded increases. As per the law of demand, other factors being constant, price and quantity demanded of a good or service are inversely related to each other. Other factors includes income, taste and preferences of consumer, prices of related goods etc. When the price of a product increases, demand for the same product will fall and vice versa. Option b is the right answer.

Demand curve is not sloping downward to the left. It is sloping downward from left to right. This indicates that there exists a negative relationship between price and quantity demanded of a good if other factors remain constant. Hence option a is not right.

Option c is also not the right answer. Demand curve usually slopes downward to the right.This is because of law of diminishing marginal utility. Downward sloping of demand curve shows the inverse relationship between price and quantity demanded of goods when other things being constant that is when the price of a good falls, consumer buys more of the good and vice versa.

Option d is also not the appropriate answer. When income of the consumer increases he buys more of the good and vice versa. Hence there exists a positive relationship between income of the consumer and quantity demanded of the commodity. In such case demand curve slopes upward from left to right. But here the question is about the 'usual slope' of the demand curve which is being downward sloping from left to right.