Question

Explain why a consumer's well-being is not constant along a demand curve.

Answer 1

A demand curve shows the maximum price willingness to pay for the particular quantity demand. The maximum willingness to pay decreases, as the more units of goods and services are consumed. So the demand curve is negative.

This is because as more units is consumed, the utility (satisfaction) by consuming more units of output decreases. It means as more unit is consumed, the wellbeing of the people decreases because more well being means more satisfaction.

Hence it can be said that a consumer's well-being is not constant along a demand curve.