Introduction to Demand
- Demand is the amount of a good/service that a consumer is willing & able to purchase at a given price in a given time period
- If a consumer is willing to purchase a good, but cannot afford to, it is not effective demand
- If a consumer is willing to purchase a good, but cannot afford to, it is not effective demand
- A demand curve is a graphical representation of the price & quantity demanded (QD) by consumers
- If data were plotted, it would be an actual curve. Economists, however, use straight lines so as to make analysis easier
- If data were plotted, it would be an actual curve. Economists, however, use straight lines so as to make analysis easier
Individual & Market Demand
- Market demand is the combination of all the individual demand for a good/service
- It is calculated by adding up the individual demand at each price level
- It is calculated by adding up the individual demand at each price level
The Monthly Market Demand For Newspapers In A Small Village
Customer 1 |
Customer 2 |
Customer 3 | Customer 4 | Market Demand |
30 |
15 | 4 | 4 | 53 |
- Individual & market demand can also be represented graphically
Market demand for children's swimwear in July is the combination of boys & girls demand
Diagram Analysis
- A shop sells both boys & girls swimwear
- In July, at a price of $10, the demand for boys swimwear is 500 units & girls is 400 units
- At a price of $10, the shops market demand during July is 900 units