Unit 4: Supply

& Demand

DEMANDChapter 4

Demand: the desire, ability andwillingness to buy a product.

DesireAbility

Willingness

What is market research?

-gathering & evaluating informationabout customer preferences

Survey customers to see how muchof an item they would buy atvarious prices

Top 10 Marketing Failures

http://www.youtube.com/watch?v=hxRqKgjD3vY

Demand Schedule:(form of a table)-A listing that showsthe quantitydemanded at all prices in the market

Demand Curve: (form of a graph)-Tells the quantity that consumerswill demand at each and every price

Price isalways on the verticalaxis (y-axis)And QuantityIs always onthe horizontalaxis (x-axis)

Demand curves slope downward

Demand Curve

Pt.Price

of DVDs

Quantity Demanded

A $30 0

B $25 1

C $20 2

D $15 3

E $10 4

F $5 50

Quantity

Price

1 2 4 53

5

15

20

10

25

30

A

B

C

D

E

F

DEM

AND CU

RVE

Quantity Demanded – the amountof a product purchased at a givenprice

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Law of Demand: the quantity demanded for an economic productvaries inversely with its price

As price goes up

Quantity demanded goes down

P

D

As price goes down

Quantitydemandedgoes up

P

D

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Law of Demand illustrated:

Change in Quantity Demanded:-A change in the amount of a product you buy because the priceof the product changed.

-When the quantity demandedchanges, it will cause you to movealong the same curve, up/down

We call these “movers”

Movement on the Curve

Quantity

Price

A

B

C

D

E

F

Change in Quantity Demand

Moves along the curve