Friday, July 20, 2018

Demand and factors that influence demand curve

Demand:
Demand is the consumer's ability, desire and will to purchase at various prices for the goods and services. An increase in price will decrease the quantity of demanded goods. A decrease in price will increase the quantity of demanded goods. 

Demand curve:
A demand curve shows the quantity demanded of a given product at varying prices. For most goods, this is a downward sloping line.

Factors that influences demand curve:
1. Tastes and preferences of the customer.
2. Cost of production.
3. Profitability of goods.
4. Aims and expectation of the producers.
5. Seasonality (weather and climate)
6. Profitability of alternative products.
7. Distribution of income.

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