Why should the relationship between quantity demanded and price be inverse?

Question

Why should the relationship between quantity demanded and price be inverse?

Answer 1

Lol! Why should it not? Maybe this is for homework or maybe there is a misunderstanding here. If everyone wants something, it drives the price up because it becomes scarce. That's why people pay out the *** for playstation 3s over the internet during Christmas. I think it's more of a natural phenomenon that a "should". Adam Smith didn't just say it is so so therefore it is, he observed it so and made a formula of it.

Answer 2

There are two ways to understand this..........

Firstly, the law of demand approach...... If the price of a good rises, then fewer people will be able to afford it...... Therefore, its demand will fall...... But, if the good becomes cheaper or if its price falls, then a lot many people from poorer sections of the society would be able to afford it........... Hence, its demand would rise.....

Secondly, the law of diminishing utility........ As we consume more of a good, its utility falls........For example: the utility derived from the first mango will be the highest and will decrese as one will consume more mangoes (in other words pleasure from eating the first mango will be more than the second and second will be more than the third)

Mangoes Utility

1st mango - 20

2nd mango -  17

3rd mango -  10

4th mango - 6

5th mango - 0

Thus, as the utilty falls, so does the demand......... A person consuming the 4th mango will pay a much lower price for the mango as compared to the person consuming the 1st mango......