The variation of consumer demand due to a change in price

• A. Elasticity of demand
• B. Diversity
• C. Distribution
• D. Disposable income

Answer: (A)

The variation of consumer demand due to a change in price is captured by price elasticity of demand. This concept describes how much the quantity demanded responds when price changes. If a small price change leads to a large shift in quantity demanded, demand is elastic; if the quantity demanded changes little in response to price changes, it is inelastic. Understanding elasticity helps explain consumer sensitivity to price and informs pricing and revenue forecasting.

Diversity refers to the variety of products offered, not how demand responds to price. Distribution concerns how goods are allocated or spread across channels or markets. Disposable income is the money available to consumers after taxes, which affects overall purchasing power but isn’t the measurement of demand’s responsiveness to price changes.