Which of the following statements is correct regarding the demand curve?

I. It is a graphical representation of the demand function.

II. It gives the quantity demanded by the consumer at each price. 

The correct answer is Both I and II.

Key Points

• A demand curve is a graphical representation of the demand function.
• It shows the relationship between the price of a good and the quantity demanded by consumers.
• The demand curve slopes downward from left to right, which means that as the price of a good decrease, the quantity demanded increases.
• This is because consumers are willing and able to buy more of a good at a lower price.
• The demand curve also gives the quantity demanded by the consumer at each price.
• For example, if the price of a good is ₹10, the consumer is willing and able to buy 10 units of the good.
• If the price of the good decreases to ₹5, the consumer is willing and able to buy 20 units of the good.

Additional Information

• Demand Curve and the Law of Demand
  • ​If the prices of other goods, the consumer’s income and her tastes and preferences remain unchanged, the amount of a good that the consumer optimally chooses becomes entirely dependent on its price.
  • 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.
  • Factors that affect the demand curve:
    • ​Income
    • Changing Tastes or Preferences
    • Changes in the Composition of the Population
  • Demand Curve 
    • The demand curve is a relation between the quantity of the good chosen by a consumer and the price of the good.
    • The independent variable (price) is measured along the vertical axis and the dependent variable (quantity) is measured along the horizontal axis.
    • The demand curve gives the quantity demanded by the consumer at each price.