In microeconomics, what relationship does a standard demand curve show between the quantity demanded and the price of a good?

Introduction / Context:
The demand curve is one of the most basic and important tools in microeconomics. It provides a visual representation of how much of a good or service consumers are willing and able to purchase at different possible prices, holding other factors constant. Understanding what variables are plotted on the axes of the demand curve is essential for correctly interpreting shifts and movements along the curve. This question checks if you can correctly identify the relationship shown by a standard demand curve in a simple, single good context.

Given Data / Assumptions:

• We are dealing with a single good in a standard microeconomics framework.
• The demand curve holds all other factors such as income, tastes, and prices of related goods constant.
• The horizontal axis usually measures quantity demanded.
• The vertical axis usually measures the price of the good.

Concept / Approach:
The key concept is the law of demand, which states that, ceteris paribus, there is an inverse relationship between the price of a good and the quantity demanded by consumers. As the price falls, quantity demanded generally rises, and vice versa. This relationship is represented graphically by a downward sloping demand curve. Thus, the demand curve explicitly links quantity demanded to the good's own price, not to quality, services, or other variables. Therefore, among the options provided, the correct statement must clearly connect quantity demanded with the price of the same good.

Step-by-Step Solution:
Step 1: Recall that a demand curve shows how much of a good consumers will buy at different prices. Step 2: Recognise that the horizontal axis represents quantity demanded. Step 3: Recognise that the vertical axis represents the price of the good. Step 4: Understand that the relationship is usually inverse, giving the curve a downward slope. Step 5: Read each option and identify which one mentions both quantity demanded and the price of the good. Step 6: Choose the option that states that the demand curve shows the relationship between quantity demanded and the price of the good.

Verification / Alternative check:
To verify, imagine plotting a simple demand schedule in a table. For each possible price, you list the corresponding quantity demanded by consumers. When you plot these pairs of values on a graph, you place quantity demanded on the horizontal axis and price on the vertical axis, and then join the points to form the demand curve. The curve itself is simply a graphical representation of this table. There is no direct measure of quality, services, or income on the axes. This confirms that the demand curve represents the relationship between quantity demanded and the price of the good, holding other factors constant.

Why Other Options Are Wrong:
The option mentioning price and quality of services confuses demand theory with service quality analysis and does not describe the standard axes of a demand curve. The options involving quality and quantity or quality and price focus on product quality, which is not directly represented on a basic demand curve. The option linking income and quality also does not match the graphical definition. While income can shift the demand curve, it is not plotted on either axis in the basic diagram. Therefore, none of these choices correctly describe what is shown by the demand curve, except the one that directly connects quantity demanded with the price of the good.

Common Pitfalls:
A common pitfall is to confuse what is shown on the axes of the demand curve with the many factors that can shift the curve. For example, income, preferences, and prices of related goods affect demand but are not directly plotted. Students may also mistakenly think that quality is explicitly represented on the demand curve, when in fact quality changes are usually modelled as shifts in the entire curve. To avoid confusion, always remember that the standard demand curve has only two variables: quantity demanded and the good's own price, with all other variables held constant in the background.

Final Answer:
Therefore, a standard demand curve shows the relationship between the quantity demanded of a good and its own price, with other factors held constant.