What Causes an Increase in the Quantity Demanded of Perfume?

Which of the following is most likely to cause an increase in the quantity demanded of perfume?

A) A decrease in the price of perfume

B) A decrease in tastes for perfume

C) An increase in income

D) An increase in the price of electricity

Answer:

The option which is most likely to cause an increase in the quantity demanded of perfume is A) a decrease in the price of perfume.

According to the Law of Demand, there is an inverse relationship between quantity demanded and price. When the price of perfume decreases, it becomes more affordable for consumers, leading to an increase in the quantity demanded. Lower prices make the product more attractive and accessible, incentivizing consumers to purchase more perfume.

This increase in quantity demanded can be attributed to the price elasticity of demand. Consumers are more responsive to changes in price when it comes to purchasing goods like perfume. As a result, a decrease in the price of perfume is most likely to cause an increase in the quantity demanded.

Therefore, the correct option is A) a decrease in the price of perfume.