Sunday, 3 November 2019

Unit 2: Market Demand


                                        Unit 2: Market Demand    

In economics demand has a specific meaning.

Demand for any commodity implies: desire to acquire it, willingness to pay for it, ability to pay for it and at a particular time.

Demand depends on not only the price of a commodity, but also income, price of related goods – both substitutes and complements – taste of consumer, price expectation and all other factors.

According to Law of Demand, there is an inverse relationship between the price of a commodity and the quantity demanded (other things remaining equal)      Demand Function: A comprehensive formulation which specifies the factors that influence the demand for the product  Demand: The quantity of the commodity which an individual is willing to purchase per unit of price at a particular time.

Derived Demand: Goods whose demand is tied with the demand for some other goods  Direct Demand: Goods whose demand is not tied with the demand for some other goods    

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