Question

Give two determinants of demand of a commodity.

Answer 1

Two determinants of demand of commodity:

1. Income of the consumer; As the income of the consumer increases ,his purchasing power increases and therefore the demand of the given commodity increases. Similarly, when the income of the consumer decreases,his purchasing power contradicts and hence the demand of the given commodity decreases.

2.Price of commodity : As the price of the given commodity increases ,its demand decreases anf if the price of the given commodity decreases,its demand increases.