A. The Demand Schedule
Both common sense and careful scientific observation show that the amount of a commodity people buy depends on its price. The- higher the price of an . article, other things held constant, J the fewer units consumers are willing to buy. The lower its market price, the more units of it are bought.
1 Later in this chapter we discuss the other factor that influence demand. including income and & tastes. The term “other thing help constant simply means we are varying the price without changing any of these other determination of demand.
There. exists a definite relationship between the market price of a good and the quantity demanded of that good, other things held constant. ‘This relationship between price and quantity bought is called the demand schedule, or the demand Curve.
Let’s look at a simple example. Table .3-1 presents a hypothetical demand schedule for cornflakes.At each price, we can determine the quantity of corn flake~ that consumers purchase. For example, at $5 per box, consumers.Will buy 9 mil-hon boxes per year.
At a lower price. more cornflakes are bought. Thus, at a price of $4, the quantity bought is 10 million
boxes.At yet a lower price (P) equal to $S. the quantity demanded (Q) is still paler, at 12 million. And 10 forth. We can determine the quantity demand at each listed price in table 3-1 .
At each market price. consumers will want to buy a c main quantity.of cornflakes, As the price of cornflakes falls, the quantity of cornflakes demanded will rise.
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