What is the relationship between supply and demand reflected by the demand curve?

The demand curve illustrates the inverse relationship between price and quantity demanded, highlighting how customers react to changes in price. When prices decrease, consumers are generally more inclined to purchase more of a good or service, resulting in a greater quantity demanded. This reflects the principle of the law of demand, which states that as prices drop, the willingness and ability of consumers to buy expands, leading to increased sales.

The correct choice showcases this fundamental economic concept, indicating that lower prices stimulate demand among consumers, making the relationship clear. This understanding is vital for businesses as it demonstrates how pricing strategies can influence consumer behavior and affect overall sales.