Download Demand - Demand is the quantity buyers are willing and able to buy

Demand - Demand is the quantity buyers are willing and able to buy at a given price in a given period of time.
Effective Demand – For demand to be effective a consumer must be both willing and able to buy the good or
service. Willing means they want it. Able means they have the money to buy it
Demand and Price
A change in price causes a movement along a demand curve
The Law of Demand – as price falls quantity demanded rises as the good becomes more affordable(ceteris paribus)
Conditions of Demand – These are the factors that cause the demand curve to shift position. To remember these
use the mnemonic PASIFIC
Population – An increase in the population will cause an increase in demand. This will cause the demand curve to
shift to the right
Advertising – Successful promotional campaigns will mean that people will want to buy more of a product at any
price and hence an increase in demand
Substitutes (Price Of) – These are goods that can be used instead of each other eg Coke and Pepsi. If Coke cut its
price the demand for Pepsi would decrease
Income – For most goods (Normal Goods) a rise in income will lead to an increase in demand. For some goods
(Inferior Goods) if incomes rise demand may decrease. An example of an inferior good might be bus travel or value
goods.
Fashion & Trends – More fashionable means more demand
Interest Rates – If interest rates rise it will be more expensive to borrow money and this may lead to a decrease in
demand
Complements – These are goods that are in joint demand. For example if the price of Blue Ray Players fell you might
see an increase in demand for Blu Ray Discs