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What does the term "ceteris paribus" mean in relation to the Law of Demand?

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Question

What does the term "ceteris paribus" mean in relation to the Law of Demand?

Options

  • All factors change together

  • Only price changes; other factors remain constant

  • Income and tastes change

  • Price does not affect demand

MCQ
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Solution

Only price changes; other factors remain constant

Explanation:

"Ceteris paribus" means that all other factors remain constant except the price, allowing the Law of Demand to be observed directly.

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