Question

Law of Demand

Provide a personal example from your own experience of the law of demand

Answer 1

Law Of Demand : The law of demand states that, other things beings equal, as the price of a good increases,its quantity demanded decreases. i.e price and quantity are inversely related. The other things in the definition involves income, price of other goods, taste and preference, etc.

Example : Suppose you go to a nearby store to buy a new Air Conditioner ( AC). When you go there you find that the prices are higher than usual i.e the prices have increased, and this new price is higher than your maximum willingness to pay for the AC. So you decide to postpone your plan of buying an air conditioner. This happens with many other potential customers. Thus an increase in the price of AC leads to its decreased demand.