Question

The relation between the consumer’s optimal choice of the quantity of a good and its price is called?

• A. Supply Function
• B. Demand Function
• C. Cost Function
• D. Output Function

Hint:

Remember: Demand = consumer side, Supply = producer side. The demand function is always about the consumer’s optimal choice at given prices.

Answer 1

The Correct Option is B

Step 1: Review Definitions.
- Supply Function: Depicts the relationship between the quantity of a good or service that producers are willing and able to sell and its price.
- Demand Function: Illustrates the relationship between the quantity of a good or service that consumers are willing and able to buy and its price, assuming all other influencing factors remain constant.
- Cost Function: Connects the total cost of production to the level of output produced.
- Production Function: Details the relationship between inputs used in production and the quantity of output generated.
Step 2: Application to the Query.
The consumer's determination of the optimal quantity consumed based on price directly corresponds to the definition of the demand function. Step 3: Final Determination.
Consequently, the appropriate response is (B) Demand Function.
Final Answer: \[\boxed{\text{Demand Function}}\]