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the background to demand the law of demand stated that other things remaining the same to hide the price of a good the smaller the quantity demanded why does it change in the price change the quantity demanded in this video well discuss the substitution effect and the income effect when the relative price of a good Rises people seek substitutes so that means the quantity demanded of the good or service decreases if you look at the original price of a banana and an apple that are equal then the opportunity cost the relative price is equal but if the price of one banana increases to one euro to buy one banana youre giving up two apples lets have another look at Anna John Tim and felicity Anna originally bought two apples and ate bananas within a budget of five euros an apple and a banana were equally priced at 50 euro cents but given the change in price of a banana to one euro what are now her options who she can buy five bananas she can also choose for bananas into apples or three b
