What happens to the quantity demanded when the price increases?

When the price of a good or service increases, the quantity demanded typically decreases. This relationship is a fundamental principle in economics known as the law of demand. The law states that, all else being equal, as the price of a product rises, consumers are less inclined to purchase it because it becomes more expensive compared to other alternatives or because it consumes a larger portion of their budget. As a result, they either choose to buy less of that product or substitute it with a more affordable alternative. This behavior reflects rational consumer choice, where individuals seek to maximize their satisfaction while managing their expenses.

In the context of the other options, when the price increases, it is unlikely for the quantity demanded to increase or remain the same, as that would contradict the law of demand. An unpredictable outcome would also not accurately represent consumer behavior, as demand typically follows a consistent pattern relative to price changes. Thus, the correct understanding is that an increase in price leads to a decrease in quantity demanded.