Question : Assertion: When the price of a good decreases, 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, which is supported by the law of demand. The law of demand states that there is an inverse relationship between the price of a good and the quantity demanded, holding other factors constant. When the price of a good decreases, consumers are more willing and able to purchase it, leading to an increase in quantity demanded. Therefore, both the assertion and reason are correct and related.
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