Demand Of A Good And Demand Essay

Demand Of A Good And Demand Essay

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The Law of Demand states that “there is an inverse relationship between the price of a good and demand. As prices fall, we see an expansion of demand. If price rises, there will be a contraction of demand (Riley, 2016).”

In the world of economics ‘demand’ refers to one’s willingness and ability to acquire goods or services. This means that one desires something enough that they are willing to procure it, therefore, creating a sense of demand. However, simply desiring a good or service is not the sole meaning behind demand. Along with the desire to procure an item or service comes the ability to do so. If one does not have the means to procure said goods or services then their desire is useless. Having the ability to obtain services or goods either through cash, check, credit or trade plays a vital role in the demand theory. Demand by nature is a circumstance where one is able and willing to purchase desired goods or services in the present tense rather than sometime down the road.
Demand therefore is considered to be a conventional action. But there are various possibilities that one must consider. Demand varies from individual to individual and from item to item. This isn’t a concern as the market is accustomed to compiling all individual demands to fit into a buyer/sellers’ market. Demand is best described with the use of time units. If a buyer is looking to purchase an item or items you would need to know if that request comes with a timeframe (today, next week or in a year) as well as the quantity needed. Time units are occasionally over looked by the economist, but it is important to specify exactly what the buyer and seller require.

Economic need to know is not as important as balancing one’s own budget or learning ...


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...ial writer for Investopedia, states that, “The law of demand states that, if all other factors remain equal, the higher the price of a good, the less people will demand that good (Heakal, 2003).” To put it another way the higher the cost of a product the less demand for it. People in general shun a costly product especially if it forces them to give up something they desire more. Take a look at this chart, it demonstrates that the curve is on a downward slope.

The demand curve is represented by points A, B, and C. The points reflect an association amongst the price (P) and the quantity demanded (Q). This chart demonstrates an undesirable connection in regard to price and quantity demanded. This is a perfect example of where the higher cost of the product results in a lower demand (A) for the goods. The lower the cost of a good will increase the demand for it (C).

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