ECON 1012 Lecture Notes - Demand Curve, Economic Equilibrium, Normal Good
25 Jan 2023
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Document Summary
The requirement is that when analysing the relationship between two variables (such as price and quantity demanded) other variables must be held constant. The definition of the laws of demand and supply apply when other factors that might affect demand, such as changes in income or changes in advertising, are assumed to be constant or unchanged. The main factor in consumer decisions is price, so it makes sense, to begin with, price when analysing the decisions of consumers to buy a product. It is important to note that when we talk about demand we refer to what the consumer is both willing and able to buy, not necessarily what they want. Demand schedule- a table showing the relationship between the price of a product and the quantity of the product demanded. Quantity demanded- the amount of a good or service that a consumer is willing and able to purchase at a given price.
