A demand curve is built assuming that
A) income is derived from demand.
B) price remains the same, and fixed costs change.
C) everything but price and demand remains the same.
D) a change in quantity demanded causes a change in price.
E) the firm does not advertise.

Question

Quizplus · Accepted Answer

A demand curve is built assuming that everything but price and demand remains the same, meaning that factors such as income, fixed costs, and advertising do not affect the curve. The curve simply shows the relationship between price and the quantity of a good or service that consumers are willing to buy at that price, holding all other factors constant.

A Demand Curve Is Built Assuming That