Demand & Elasticity Of DemandGROUP-2

SOURCES: http://220.227.161.86/16781Demand_n_Elasticity.pd

1. Introductory Microeconomics and Macroeconomics - TR Jain, VK .Ohri

2. Managerial Economics-Dominick Salvatore

Definitions Of Demand

Demand refers to the Quantities of Commodity that the consumers are able to buy at each possible price during a given period of time, other things being equal.

Demand is the Ability and willingness to buy Specific Quantity of the good at Alternative Prices in given Time Period, Ceteris Paribus.

By: Gaurav Wadhwa

Determinants of Demand:

Price of the CommodityPrice of Related CommoditiesChange in income of consumerTaste and Preferences of ConsumersOther Factors

Price of Related Commodities

Change in income of consumerDemand for normal goods tend to

increase with increase in income, and vice versa.

Demand for inferior goods like coarse grain tends to decrease with increase in income, and vice versa.

Law Of Demand

Law Of Demand states that people will buy more at lower price and by less at higher price, Ceteris paribus

By: Samuelson

The Law Of Demand states that quantity demanded increases with fall in price and diminishes when Price Increases, other thing being equal.

By: Marshall

By: Probir Roy

Explanation Law Of Demand may be explained with the

help of Demand Schedule:

It is defined as a Table which shows quantities of a Given Commodity which an individual consumer will buy at all possible prices at a given time.

Demand Curve

The Demand Curve slopes downwards from Left to Right, meaning thereby that when Price is High Demand is Low and Vice Versa.

Assumptions To Law

Consumers are rationalConsumer’s income remains constantConsumers do not expect a change in price in

the futureThere is no change in the price of substitute

and complementary goodsThere is no change in tastes, fashions, etc of

the consumerGoods should be normal

Expansion And Contraction Of Demand

By: Mayank Sharma

Diagram

Increase And Decrease Of Demand

Diagram

Elasticity Of Demand

It Answers the “Question By How Much”?

Elasticity of Demand is defined as the responsiveness of the quantity demanded of a commodity to change on one of the variable on which demand depends.

By: Rohit Lamba

Price Elasticity Of Demand It is Measured as a percentage Change in Quantity

Demanded divides by Percentage Change In Price, Other thing Remaining Same.

Degrees Of Price Elasticity Of Demand

Determinants Availability of SubstitutesPosition of Community in consumer’s

BudgetNature of need that a community satisfiedNumber of uses to a community is putPeriodConsumer Habits

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