Demand Analysis, Supply Analysis& Equilibrium concept
By:Akshat. D. Yadav
Demand, concept & Analysis
Supply & Demand are two important component of Market along with Price
.
Success of any business is determined by two factors:-
Demand of the product at a price & the rate of growth of demand
Supply capability of the business to match the demand.
I
t is therefore essential to understand Demand & Supply concept.
Demand
Demand can be defined as
want desire or need of an individual backed withability to pay and willingness to pay in a given period of time
Demand can also be defined as
effective desire which is backed by ability andwillingness to pay
Demand can also be defined as
quantity of a commodity which consumers arewilling to buy at a given price for a particular unit of time.
Demand continued: Types of Demand
T
ypes of demand can be categorized on following bases:-
N
ature of commodity demanded ( Consumer goods or capital goods)
Time unit (Short run or Long Run)
Relation between two goods .
Demand can be of following types on the basis of above categories:-
1
.
Direct & Derived Demand2.Recurring & Replacement Demand3.Complementary & Competing Demand4.
I
ndividual & Market DemandDirect & Derived Demand1)Direct Demand: When a product is demanded for its own use by final consumersthen it is known as
Consumer Goods & its demand is knownas
Direct Demand Examples are household items like
T
.V Etc.2)Derived Demand: When a product is demanded for producing anothercommodity then it is called
Capital Goods & its demand iscalled
Derived Demand e.gdemand for A.C creates demandfor its parts and components
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