Econ: Graphing Demand


A demand curve shows all the prices and quantities at which consumers are willing and able to purchase a good or service. The law of demand states that consumers will want to buy more at a lower price and less at a higher price.

There is a difference between a change in demand and a change in quantity demanded.

A change in quantity demanded is a movement along the demand curve and can be caused only by a change in the price of the good or service. At a lower price, a larger quantity is demanded. A change in demand is a shift in the curve whereby more or less is demanded at every price. Changes in preferences incomes, expectations, population, or the prices of complementary or substitute goods will cause a change in demand.

Arrows-02-june

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