A demand curve is downward sloping because
A) as the price of the good decreases, the consumer finds that a lower indifference curve is attainable.
B) as the price of the good decreases, the consumer finds that a higher indifference curve is attainable.
C) consumers move downward along a budget line as the price of a good decreases.
D) consumers move upward along a budget line as the price of a good decreases.

Question

Quizplus · Accepted Answer

As the price of the good decreases, the consumer will be able to afford more of the good and, as a result, will be able to consume combinations of goods that place them on a higher indifference curve. This leads to a higher quantity demanded at lower prices, resulting in a downward-sloping demand curve.

A Demand Curve Is Downward Sloping Because