What economic principle is best illustrated by the law of demand?

The law of demand is fundamentally based on the principle that there is an inverse relationship between price and quantity demanded. This means that as the price of a good or service decreases, consumers are willing to purchase more of it, and conversely, if the price increases, the quantity demanded typically decreases. This relationship reflects consumer behavior and is graphically represented by a downward-sloping demand curve on a price-quantity graph.

Understanding this principle is crucial because it highlights how price changes can affect consumer purchasing decisions. For example, if fresh strawberries are priced lower during a sale, more consumers are likely to buy them compared to when they are priced higher. This concept helps businesses and economists predict how changes in price can influence market demand, making it essential for various economic analyses, from pricing strategies to fiscal policies.

The other options touch on related concepts but do not encapsulate the fundamental nature of demand as clearly as the inverse relationship between price and quantity demanded.