Demand is comprised of 3 elements:

• desire
• ability to pay
• willingness to pay

The Law of Demand states that "the higher the price, the fewer people are willing to buy the good; the lower the price, the more people who want to buy the good."

To determine what the price of a product will be, a table featuring the demand of the product according to different prices, called a demand schedule, is used.

A visual graph representation of this table is called a demand curve.

Qd : quantity demanded

Shifts in the demand curve can be caused by various factors:

• comsumer taste
• number of buyers
• income
• princes of related goods
  • substitute goods (goods that serve in a similar function)
  • complementary goods (goods that are consumed together)
• consumer expectation

basics | supply | demand | equilibrium | shortage | surplus | graphs