The Relationship Between Price Decrease and Demand for GPS Systems
What happens when the price of GPS systems decreases?
A. an increase in the demand for GPS systems. B. a decrease in the quantity of GPS systems demanded. C. an increase in the quantity of GPS systems demanded. D. a decrease in the supply of GPS systems.
Answer:
A decrease in the price of GPS systems will result in an increase in the quantity of GPS systems demanded.
When the price of GPS systems decreases, it leads to an increase in the quantity of GPS systems demanded. This is due to the law of demand, which states that as the price of a good decreases, the quantity demanded for that good increases. In this case, consumers are more willing and able to purchase GPS systems at a lower price.
This increase in quantity demanded also reflects the inverse relationship between price and quantity demanded. As the price decreases, consumers perceive GPS systems as more affordable, leading to a higher demand for them in the market.
Therefore, a decrease in the price of GPS systems positively impacts the demand for GPS systems by increasing the quantity of systems demanded by consumers.