Question : Law of Demand states that there is a negative relationship between ______.
Option 1: demand for a commodity and its supply
Option 2: demand for a commodity and its price
Option 3: tax on a commodity and its price
Option 4: supply of a commodity and its price
Correct Answer: demand for a commodity and its price
Solution : The correct option is demand for a commodity and its price .
The Law of Demand asserts a negative relationship between the price of a commodity and the quantity demanded. As the price rises, demand tends to decrease, and vice versa. This inverse correlation reflects consumers' inclination to buy more at lower prices and less at higher prices, influencing market dynamics.
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