Question

Resolve the following: “The price of health club memberships increased in the Winter, yet the quantity also increased. Therefore, the law of demand does not apply to health clubs.”

Answer 1

This does not necessarily mean the law of demand does not apply here. The law of demand state that 'other things remaining constant' the quantity demanded goes up when the price goes down and the quantity demanded goes down when the price goes up. Therefore, in order to the law of demand to be applicable, other factors (factors other than price) affecting demand must be held constant. However, here the season is changing which is affecting quantity demanded as well.