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What is meant by the contraction of demand? -

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Question

Read the following news report and answer the Q.97-Q.100 on the basis of the same:

The quantity of a commodity that a consumer is willing to buy and is able to afford, given the prices of goods and the consumer's tastes and preferences is called demand for the commodity. Whenever one or more of these variables change, the quantity of the good Chosen by the consumer is likely to change as well. The relation between the consumer's optimal choice of the quantity of a good and its price is very important and this relation is called the demand function. Thus, the consumer's demand function for a good gives the amount of the good that the consumer chooses at different levels of its price when the other things remain.

What is meant by the contraction of demand?

Options

  • Movement along a demand curve

  • Shift in the demand curve

  • Fall in consumer's income

  • None of the above

MCQ

Solution

Movement along a demand curve

Explanation:

The movement along a demand curve is referred to as the contraction of demand. On the same demand curve, the customer shifts left or right.

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