State and explain law of demand with assumptions.

The law of demand states that, keeping other factors constant, the quantity demanded of a good increases when its price falls and decreases when its price rises.

• There is an inverse relationship between price and demand.
• This is because consumers buy more when prices are low and less when prices are high.

Assumptions

1. Consumer income remains constant.
2. No change in tastes and preferences.
3. Prices of related goods remain constant.
4. No expectation of future price change.
5. Population size remains stable.

Thus, the law of demand reflects consumer buying behavior under normal conditions.