Law of demand

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Statement

The law of demand states the following equivalent things:

  • The price-elasticity of demand for a good is non-positive, and typically negative.
  • As the price of a good increases, the demand for it decreases.
  • As the price of a good decreases, the demand for it increases.

Goods satisfying the law of demand are termed ordinary goods. Examples of goods that (appear to) fail the law of demand are Veblen goods and Giffen goods.