Law of demand

The law of demand states that when prices of goods and services rises the quantity demanded falls because first of all, it drives away all those good bargain hunters and cheap people if it got into a price level expensive enough for them. Individuals who have just enough cash to buy it would no longer intend to purchase the good when the price increased due to worries that they might run out of cash before payday arrives.

Demand Schedule

A table representing the quantity intended to purchase a good at a certain price level. These are assumptions about the buyer's sentiment towards the number of intended purchases at different prices for instance, he's got $10 and he intends to buy 10 sodas and 2 chips with that money. At $0.50 cents per soda he could get 10 sodas for $5 enough for his entire crew, but if the price is more than the usual he would have to face a decision whether to still buy 10 sodas using all his available money sacrificing the chips.

Demand Curve

This is a graphic representation of buyer's sentiment towards a change in price. It plots the degree of relationship between the price of the good and the number of items demanded at that price level. This is like drawing how the demand schedule looks like when converted to an image. Changes in the demand curve are caused by events such as taxes which increases the price a little bit therefore decreasing total demand. There are instances where the demand for an item changes at the same price level this is caused mainly by the average income of the consumer or the available disposable resource. This is called the shift in demand.

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