Demand

                The quantity of desired goods and services that the consumer are willing and able to purchase from market at various prices per period of time is demand. In other words demand is the fusion of various elements of demand i.e; desire, willingness to pay & ability to pay.

*Law of Demand: The inverse relationship between “price & quantity demanded” when other thing remaining the same. It  indicates theh higher the price lower the quantity demanded & vice versa, when oter things remaining the same.   

*Demand schedule: The tabular representation of relationship between price & quantity  demanded is demand schedule.

            Price           Quantity

               1                         6                  

               2                         4

               3                         2

*Demand curve: The graphical representation of relation between price & quantity demanded is called demand curve. It is also classified under the following topics:                                                                                                                                                                                                                                                                                                                                                         

 Linear: The negative relation between price and quantity demanded at the constant rate of change in price and quantity demanded

Non-linear: the inverse relation between price 7 quantity demanded at different rate of change  change in price & quantity demanded. The demand curve is in rectangular hyperabolla shaped.  

*Demand function: The functional relationship between ‘demand and determinants of demand’ is called demand function. The demnd function is also classified under the following sub-subtopics:                     Price function: Only the “price” as a determinant of demand.                    

Non-price function: Determinants other than the price is non-price factor; E.g; Income, publicity/advertising, season/weather, culture, taxation etc.

D= f {Y,Pb/Ad, S, C, T, etc,}            
✳DETERMINNTS OF DEMAND

            The factors that affect in demand are determinants of demand. The determinant of demand are categorized under price & non-price factors. Here the price other than the price are non-price factors. The following points can be described as determinants of demand;

1)Price: When price of a commodity increases the quantity demand of such commodity decreases and vice versa, i.e: price inversely determines the quantity demanded.

2)Income of consumers: When an income of consumer increases the quantity demanded in case of normal good increases and decreases in case of inferior goods.

3)Publicity & advertising: Publicity & advertising provides incentives and pressure to purchase more quantity of product. Thus it cause rise in demand.

4)Weather/season: Season causes the change in demand of consumers  with adjustable goods. For instance; the demand of coke is more in summer than winter.

5)Price expectation: If people expect price of a product is increasing in future, then the demand for the product will be higher. Thus PE cause rise in demand at present.

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