The law of demand states that, all else being equal, as the price of a good or service decreases, the quantity demanded increases. Conversely, as the price of a good or service increases, the quantity demanded decreases. This is due to the inverse relationship between price and quantity demanded. This relationship can be represented by a downward-sloping demand curve on a graph, showing the negative correlation between price and quantity demanded. When the price of a product is high, consumers are less willing to purchase it, leading to a lower quantity demanded. On the other hand, when the price is low, consumers are more willing to buy, resulting in a higher quantity demanded. Understanding the law of demand is crucial for businesses and policymakers as it helps predict consumer behavior in response to price changes. By analyzing demand curves, businesses can set optimal pricing strategies to maximize profits, while policymakers can make informed decisions on taxes and regulations to achieve economic goals. In conclusion, the law of demand is a fundamental concept in economics that explains the relationship between price and quantity demanded. By grasping this concept, individuals can better understand how market forces interact and influence economic outcomes.