demand Flashcards
(13 cards)
What is the definition of effective demand
willingness and ability to buy a product over a range of prices within a specified time period
what does willing mean
want to buy product
meaning of able
have money to buy product
what is individual demand
demand of one consumer
what is market demand
total demand for product from consumers willing and able to buy it
what is the law of demand
price and q demanded are inversely related if price rise,demand falls and vice versa. ceteris paribus(assuming all else stays same)
what is a demand curve
shows the relationship between total quantity demanded by consumers each period at each price of product
why is the demand curve downward sloping
law of diminishing marginal utility,utility=satisfaction,more you consume,less satisfaction so less willing to payw
what does rightward shift of demand curve signal
consumers demand more of a prduct at every price than they did before
leftward shift in demand meaning
consumers want less of a product at every price than they did before
What are non price determinants of demand?
Other factors
Population changes
Price of related goods
Goverment policy
Income
Taste,habit and fashion
difference of normal and inferior good
demand rise as income rise for normal and demand fall as income rise for inferior
