Suppose we observe a rise in the price of good A and an increase in the quantity of good A bought and sold.Which one of the following is a likely explanation?
A)The law of demand is violated.
B)The demand for A decreased.
C)The demand for A increased.
D)The supply of A increased.
E)The supply of A decreased.

Question

Quizplus · Accepted Answer

If the price of good A increases and the quantity bought and sold also increases, it is likely that the demand for A has increased. This means that despite the higher price, consumers still want to purchase more of the good.

Suppose We Observe a Rise in the Price of Good