[amp_mcq option1=”price varies directly with quantity demanded” option2=”marginal utility diminishes as price rises” option3=”there will be a fewer purchases at a higher price than at a lower price” option4=”income is fixed and so total expenditure on the commodity is limited” correct=”option3″]
The correct answer is: C. there will be a fewer purchases at a higher price than at a lower price.
A normal demand curve slopes down from left to right because consumers are generally willing to purchase more of a good or service at a lower price than at a higher price. This is because the law of demand states that, all other things being equal, the quantity demanded of a good or service will decrease as the price of that good or service increases.
Option A is incorrect because price and quantity demanded are inversely related, not directly related.
Option B is incorrect because marginal utility is the additional satisfaction or benefit that a consumer receives from consuming one more unit of a good or service. Marginal utility diminishes as consumption increases, but this does not necessarily mean that consumers will purchase fewer units of a good or service at a higher price.
Option D is incorrect because income is not the only factor that affects demand. Other factors that affect demand include the price of related goods, tastes and preferences, and expectations about future prices.