Law of Demand

The Law of Demand states that, all else being equal, as the price of a good or service decreases, the quantity people want to buy generally increases. Conversely, when the price rises, demand tends to decrease. This relationship occurs because lower prices make products more affordable, encouraging more consumers to purchase, while higher prices can discourage buying or lead consumers to seek alternatives. The law illustrates the inverse connection between price and demand, helping businesses and policymakers understand market behaviors and set pricing strategies accordingly.