DEmand And Shifts in DEmand

Syed Abdullah Nabil

Getting Started Chapter Glossary
▪ Demand refers to the willingness and ability of a consumer to purchase a
product or service.  
▪ Effective demand is demand that is backed by the ability and willingness to pay
for a product or service. In other words, effective demand is demand those results
in actual purchases or sales. 
▪ Demand Curve line drawn on a graph that shows how much of a good will be
bought at different prices. 
▪ Demand Schedule is the table of quantity demanded of a good at different price
level. 
▪ Shift in the demand curve shows the movement to the left or right of the entire
demand curve when there is a change in any factor affecting demand except the
price.
Getting Started Chapter Glossary
▪ Disposable income is the amount of money that an individual has available
for spending and saving after all mandatory deductions, such as taxes and
social security contributions. Disposable income is an important indicator of
a person's standard of living and their ability to consume and save. 
▪ Inferior Goods are goods whose demand will fall with rise in income and rise
if income falls. 
▪ Normal Goods are goods for which demand rises as rises and falls if income
falls.
▪ Substitute goods are products or services that can be used in place of one
another.
▪ Complementary goods are products or services that are used together.
Law of Demand

Ceteris Paribus (If other things remain constant)

Price ↓ Quantity Demanded ↑

Price ↑ Quantity Demanded ↓

Price and Quantity Demand have an Inverse Relationship.

Movement along the demand curve

Occurs due to changes in price only

Shifts of the demand curve

Occurs due to changes in any factor other than price.

Advertising

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Demographic
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End of Chapter