Demand

Question 1

What is Demand

Answer 1

The quantity of a good/service that consumers and businesses are WILLING AND ABLE to buy at a given price

Question 2

What is Ceteris Paribus

Answer 2

All the other factors being equal

Question 3

What is the Law of Demand

Answer 3

As the price increase, quantity demanded decrease, ceteris paribus (You must write “ceteris paribus”!)

Question 4

What is market demand?

Answer 4

Market demand is the sum of the indivisual demand for a good/service froms buyers in the market

Question 5

What is a demand schedule

Answer 5

A demand schedule is a form that tells you the exact quantity that will be purchased at any given price

Question 6

What is a demand curve?

Answer 6

A demand curve plots the demand schedule on a chart.
The quantity is on the Horizontal or X-axis.
The price is on the verticle or Y-axis.

Question 7

What is elastic demand and what is inelastic demand, give example for each.

Answer 7

Elastic demand is where the quantity bought changes a lot when the price rises/lowers
Inelastic demand is when quantity bought doesn’t change much when the price rises/lowers

Question 8

What are the five determinants of demand?

Answer 8

Tasts and preferences
Income
Price of complements
Price of subsitutes
Number of consumers