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‘As the price of a good falls, the resulting increased purchasing power may be a reason for increase in quantity demanded’. Do you agree with the given statement? Give reason for your answer. 

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When price of a good falls the purchasing power (real income) of the consumer increases as he will able to purchase more units of the given good with the same money income. This phenomenon is called as income effect and is one of the main reasons for negative slope of demand curve. 

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