income effect: the income effect is the change in consumption patterns that results from a change in the consumer's purchasing power. when the price of a good decreases, the consumer has more purchasing power, which can lead to an increase in the quantity demanded of the good. conversely, when the price of a good increases, the consumer has less purchasing power, which can lead to a decrease in the quantity demanded of the good. substitution effect: the substitution effect refers to the change in consumption patterns that results from a change in the relative prices of goods. when the price of a good decreases, it becomes relatively cheaper compared to other goods, which can lead consumers to substitute the good for other, more expensive goods. conversely, when the price of a good increases, it becomes relatively more expensive compared to other goods, which can lead consumers to substitute away from the good. diminishing marginal utility: finally, the law of diminishing marginal utility states that as a consumer consumes more and more of a good, the additional satisfaction they derive from each additional unit of the good consumed decreases. this means that as the price of a good decreases, the consumer will demand more of the good due to the increase in purchasing power, but the additional utility derived from each additional unit consumed will decrease. as a result, the quantity demanded of the good will increase, but at a decreasing rate. taken together, these three factors contribute to the negatively sloped demand curve, which shows the inverse relationship between the price of a good and the quantity demanded of that good.