What Is Demand

The official definition of demand is as such: Demand is the relationship between price and quantity demanded for a particular good and service in particular circumstances. For each price the demand relationship tells the quantity the buyers want to buy at that corresponding price. The quantity the buyers want to buy at a particular price is called the “Quantity Demanded.”
So what determines the amount of a product that people are willing to buy? Demand refers to the willingness and ability of a person to purchase the good or service. Economists answer these questions by studying every factor in the decision a consumer makes. Consumers are those who want or need products or services. ...

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tend to buy more of as their income increases. Inferior goods are goods that people use less of as their income increases.
The goals of a person refer to the "wants" and "needs" of a person. Goals of a consumer depends on multiple factors. Factors ranging anywhere from age, education, and region to social customs. People in different areas are influenced by different things and therefore demand for specific goods. (Provided the means for paying for the goods is there) Substitutes and complements also tend to influence the quantity of a bought product. Substitutes tend to satisfy a set of goals or preferences for a set of people. Price will affect the quantity bought for substitutes in the long run. People buy what is within their means. Complements when priced low enough sometimes may increase the consumption of the product that they complement.

Other factors that may influence the direction of the market include the number of consumers in the market and their ...

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Added: 1/8/2004 04:31:52 AM
Category: Economics
Type: Premium Paper
Words: 508
Pages: 2

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