DEMAND ANNALYSIS

BY GROUP-14 KRUPAL H.MEHTA-1111341 SUFI -1111343 RAGHAV-1111345 SHRUTI-1111331 TUSHAR-1111329

SUBJECT-MANAGERIAL ECONOMICS

FACULTY INCHARGE-V.K.XAVIER SIR

WHAT IS DEMAND?
Demand refers to the quantities of goods that consumers are willing and able to purchase at various prices during a given period of time.

ELEMENTS OF DEMAND
DESIRE OF THE CONSUMER TO BUY A COMMODITY ABILITY TO PAY WILLINGNESS OF CONSUMER TO PAY The term demand is meaningful only when it has reference to price, particular period and place

DEFINITION OF DEMAND
Demand is defined as the quantity of a commodity or service which consumers are willing to buy at a price in a particular period

DETERMINANTS OF DEMAND
PRICE OF PRODUCT (Px) INCOME OF CONSUMER (Y) PRICE OF RELATED GOODS,SUBSTITUTES OR COMPLIMENTS(Py) TASTE AND PREFERENCE OF THE CONSUMER(T) FASION AND HABBITS(F) WEATHER AND CLIMATE(W) CUSTOMS AND RELIGIOUS PRACTISE

ADVERTISEMENT(A) WAR AND EMERGENCIES(E) NUMBER OF CONSUMERS IN THE MARKET (P) CONSUMER s EXPECTATION WITH REGARD TO FUTURE MARKET PRICE INCOME DISTRIBUTION

DEMAND FUNCTION
DEMAND FUNCTION EXPLAINS THAT DEMAND FOR A COMMODITY DEPENDS ON VARIOUS FACTORS. ALGREBRAICALLY DEMAND FUNCTION CAN BE EXPRESSED BY THE FOLLOWING EQUATION.

Dx

f(Px , Y , Py, A , T . F , P ..)

Where Dx is a demand for a particular product.

PRICE DEMAND FUNCTION

Price demand function explains the inverse relationship b/w quantity demanded of a goods and its price.

INCOME DEMAND FUNCTION

Income demand function refers to various quantities of a commodity or service that a consumer buys at various levels of income, assuming other factors(price of goods ,taste and preference of the consumer)remain constant.

CROSS DEMAND FUNCTION

Demand for a commodity is also influenced by the change in the price of the related commodity. It refers to the quantity of a commodity that a consumer is ready to buy at a given time due to change in the ;price of related commodity assuming his income and price of the commodity remains constant.

DEMAND CURVE
Demand curve is the graph of demand schedule. While drawing demand graph , price is measured on Y-axis and quantity demanded is measured on X-axis.

LAW OF DEMAND
Law of demand explains the inverse relationship b/w price and quantity demand. Prof. Marshall stated the law as other things remaining the same , quantity demanded of the product vary inversely with its price. In other words the demand of a commodity rises when the prices fall and the demand contracts when the prices rise.

ASSUMPTIONS OF LAW OF DEMAND

CONSUMER s INCOME REMAIN CONSTATNT PRICE OF RELATED COMMODITIES REMAIN CONSTANT TASTE AND PREFERENCES REMAIN CONSTANT POPULATION REMAINS CONSTANT GOVT POLICY THERE IS NO CHANGE IN WEATHER CONDITIONS

 THERE IS NO CHANGE IS ADVERTISEMENT FASHION DOES NOT CHANGE

EXPECTION OF LAW OF DEMAND

GIFFEN s PARADOX.

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