Which of the following statements is true regarding price increase and demand?

The statement about quantity demanded decreasing with price increases accurately reflects a fundamental principle of economics known as the law of demand. According to this law, all else being equal, as the price of a product or service rises, the quantity demanded by consumers typically falls.

This relationship is illustrated by a downward-sloping demand curve on a graph where, as the price moves higher, the quantity that consumers are willing to purchase tends to diminish. This principle holds true for most goods and services in a competitive market, where consumers are likely to seek alternatives or forego a purchase if the price becomes too high.

The other options suggest incorrect interpretations of price dynamics. For instance, price increases leading to higher demand contradicts the law of demand. Additionally, while higher prices can lead to unsold inventory, this is not a direct result of demand behavior and may depend on various factors including market conditions and inventory management. Furthermore, the assertion that higher prices shift the demand curve to the right is misleading, as an increase in price does not shift the demand curve itself but rather results in a movement along the curve, reflecting a decrease in quantity demanded.

Hence, the assertion that generally, quantity demanded decreases with price increases is consistent with established economic theory and is the most accurate