Question : Assertion: When the price of a good decrease, its quantity demanded increases.
Reason: The law of demand states an inverse relationship between price and quantity demanded.
Option 1: Both the assertion and reason are correct and related.
Option 2: Both the assertion and reason are correct but not related.
Option 3: The assertion is correct, but the reason is incorrect.
Option 4: The assertion is incorrect, but the reason is correct.
Correct Answer: Both the assertion and reason are correct and related.
Solution : The correct answer is (A) Both the assertion and reason are correct and related.
The assertion states that when the price of a good decreases, its quantity demanded increases. This is a basic principle of economics and is supported by the law of demand, which states that there is an inverse relationship between the price of a good and the quantity demanded. When the price of a good decreases, consumers are generally willing and able to buy more of that good, resulting in an increase in the quantity demanded.
Therefore, the assertion and reason are both correct and related.
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