Demand

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Demand

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the willingness and ability pay for something at a given time at a given price.

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Market

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any place where, or mechanism by which, buyers and sellers interact to trade goods, services or resources.

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Good

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A tangible product that consumers, firms or governments wish to purchase.

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Service

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an intangible product or action that consumers, firms, or governments wish to purchase.

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Resource

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any item, whether a gift of nature, the result of production, or the result of human effort, that is used to produce goods and services.

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Market Demand Curve

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is made up of all the individual demand curves for a good. In general, the higher the price of an item, the less an individual consumer will buy.

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Law of Demand

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a principle in economics that states that as the price of a good, service or resource rises, the quantity demanded will fall and vice versa, all else held constant.

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Demand Schedule

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a tabular representation of the relationship between the price of a good, service or resource and the quantity that individuals and firms are willing and able to buy, all else held constant.

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Demand Curve

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a graphical representation of the relationship between the price of a good, service or resource and the quantity that individuals and firms are willing and able to buy, all else held constant.

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Quantity Demanded

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the quantity of a good, service, or resource that consumers, firms and governments are willing and able to buy at a given price, all else held constant.

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Change in Quantity Demanded

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the change in the quantity if a good, service or resource that consumers, firms and governments are willing and able to buy due to a change in its price.

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Income Effect

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the effect that a change in the price of a good, service or resource has on the purchasing power of income.

ex: when prices decrease, the purchasing power of income increases and consumers are able to purchase more goods, services or resources.

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Substitution Effect

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he effect that a change in the price of a good, service or resource has on the demand for another.

Ex: an increase in the price of one good will increase the demand for its substitutes and vice versa.

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Diminishing Marginal Utility

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the negative relationship between the quantity of a good, service or resource and the marginal utility obtained from each additional unit consumed in a given period of time.

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Market Demand

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the overall or total demand for a good, service or resource. It represents the summation of individuals demand curves, whether they represent individuals, communities, states or nations.

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Increase in Demand

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an increase in the quantity demanded of a good, service, or resource at every price. In a graph, an increase in demand is represented by a rightward shift of the demand curve.

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Decrease in Demand

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a decrease in the quantity demanded of a good, service or resource at every price. 
- In a graph a decrease in demand is represented by a leftward shift of the demand curve.

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Normal Good

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a good for which there is a direct relationship between the demand for the good and income.

-an increase in income increases demand, and a decrease in income decrease demand.

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Inferior Good

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a good for which there is an inverse relationship between the demand for the good and income.

-an increase in income decreases demand and a decrease in income increases demand.

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Taste and Perceptions

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the perception of the desirability associated with consuming a good, service, or resource

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Buyers

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market participants who seek to obtain goods services and resources

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Expectations

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the anticipation by individuals and firms of costs and benefits that lie in the future Consumer expectations play a crucial role in determining the demand for a good or service at different points in time. They can affect demand relationships in the present or future.

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Substitutes

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goods, services or resources that are viewed as replacements for one another.

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Complements

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goods, services or resources that are used or consumed with one another.Ex: tortilla chips and salsa.

-prices of are one of the non price determinants of demand.