Demand curve-individual demand curve-market demand curve-demand function-law of demand

Demand curve-individual demand curve and market demand curve

Demand curve is simply a graphic representation of demand schedule which shows quantities of commodity demanded at various possible prices that is expressing the relationship between different quantities demanded at different prices of a commodity.According to Leftwitch "The demand curve represents the maximum quantities per unit of time that consumers will take at various prices."

      

           Individual demand curve is a curve showing different quantities of a commodity that one particular buyer is ready to buy at different possible prices of the commodity at a point of time.

            There are large number of buyers in the market therefore Market demand curve is the horrizontal summation of individual demand curves.it shows various quantities of a commodity that all the buyers in the market are ready to buy at different possible prices of commodity at a point of time.

Demand function

demand function shows the relationship between demand for a commodity and its various determinants which are as

 price of a commodity with a rise in price its demand falls and with a fall in price its demand increases as law of demand says.

2)substitute goods    other things remaining same let us suppose X and Y are substitue goods which means good X can be consumed in place of good Y and good Y can be consumed in place of X. now suppose the price of good X increases the demand for good X will fall the consumer will shift to good Y and therefore the demand for good Y will increases note that here we are not considering tastes and prefferences of the cosumer. in case of complementary goods the demand of one commodity increases the demand of other good also. example:car and petrol serve as complemantary goods.

3)Tastes and preferences   Tastes and preferences like habit,custom,fashion,culture for example a smoker smokes 2  cigarettes every day now if the price of cigarettes rises its demand will not fall.

4)Future Expectations  If the consumer expects that the price in future will rise he will buy more and more quantity of commodity in present at the existing price.Likewise,if he predicts that price in future will fall,he will buy less in present or may even postpone his demands.

5)income of the consumer when the income of the consumer increases the demand of commodity also increases.likewise?if the income decreases the demand for commodity also falls.

Law of demand 

Law of demand expresses a functional relationship between price and quantity demanded.When the price of a commodity rises its demand decreases and when the price of commodity falls its demand increases.Thus at lower price of commodity more will be demanded and at higher price of a commodity less of it will be demanded.