Demand decreases
Explication
When the price of a good increases, the law of demand states that the quantity demanded typically decreases, assuming other factors are constant. This inverse relationship is fundamental in microeconomics.
QD = 200 - 10P
Explication
The demand formula provided is QD = 200 - 10P, which shows the relationship between quantity demanded and price; the other formulas are incorrect examples.
Inelastic demand
Explication
A PED of 0.8 indicates inelastic demand because it is less than 1. Inelastic demand means that the quantity demanded is relatively unresponsive to price changes.
Elastic market
Explication
An elastic market is highly responsive to price changes, meaning small changes in price lead to large changes in quantity demanded or supplied.
Non-excludable and non-rival in consumption
Explication
A public good is characterized by being non-excludable (cannot prevent others from using it) and non-rivalrous (one person's use does not diminish another's). Examples include national defense and public broadcasting.
They are complements
Explication
Negative cross-price elasticity indicates that the goods are complements, meaning that an increase in the price of one decreases the demand for the other.
Non-rival and non-excludable
Explication
Public goods are non-rival and non-excludable, such as national defense, which means one person's use does not diminish another's and people cannot be excluded from using them.
Alfred Marshall
Explication
Alfred Marshall, a foundational figure in microeconomics, developed many concepts related to demand and supply in the late 19th century.
PED < 1
Explication
Inelastic demand means PED < 1, indicating that the quantity demanded is less responsive to price changes.
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Demand — relationship?
Quantity demanded decreases as price increases.
Demand — definition?
Quantity consumers are willing to buy at various prices.
PED — definition?
Responsiveness of demand to price changes.
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