Unit 1b

Demand

The quantity of a good or service a consumer is willing and able to buy at various prices at a point in time

Law of demand

An increase in the price of a good or service will lead to a decrease in quantity demanded, ceteris paribus (or vice versa)

Ceteris paribus

All other factors (excluding the price of this good) remain constant

Change in quantity demanded

A movement along the demand curve caused only by a change in the price of the good itself

Change in demand

A shift of the entire demand curve caused by a non

Substitutes

Products that can be consumed in place of something else (e.g. apple instead of orange)

Complements

Products that are consumed together (e.g. fish and chips)

Demand schedule

A table showing the quantity demanded at different prices

Demand curve

A graph showing the inverse relationship between price and quantity demanded; slopes downwards