Demand
Introduced| English | Meaning |
|---|---|
| law of demand/lɔː ɒv dɪˈmænd/ | The tendency for quantity demanded to fall as price rises, with other relevant factors held constant. |
| demand/dɪˈmænd/ | The quantity of a good or service that buyers are willing and able to purchase at different prices over a period. |
| quantity demanded/ˈkwɒntɪti dɪˈmændɪd/ | The amount buyers are willing and able to purchase at a particular price over a specified period. |
| extension/ekˈstenʃn/ | An increase in quantity demanded or supplied following a price change, represented by movement along an existing demand or supply curve. |
| contraction/kənˈtrækʃn/ | A period in which overall economic activity declines. |
| income/ˈɪŋkʌm/ | Money received by a person or organisation over a period. |
| tastes/teɪsts/ | Consumers' preferences for particular goods, services or characteristics. |
Why cheaper means more
- Cut the price of pizza in half and you'd probably buy more of it. So would everyone else.
- That everyday instinct is the law of demand 需求定律 — and it shapes every market.
The law of demand states that, other things equal, as price falls:
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Lower price, more demanded — the curve slopes down.
Demand requires being both willing and able to pay.
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Wanting a good is not demand unless you can also afford it.
The law of demand 需求
- Demand = the quantity buyers are willing and able to buy at each price.
- Law of demand: as price falls, quantity demanded 需求量 rises (and vice versa) — other things equal.
The demand curve slopes down — lower price, more bought.
Demand & supply
Demand slopes down — cheaper means more wanted.
A fall in the good's own price causes an ______ of demand (a movement down the curve).
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Price fall → extension; price rise → contraction.
Movement along the curve
- A change in the good's own price causes a movement along the demand curve.
- A price fall → an extension 扩张 (more demanded); a price rise → a contraction 收缩 (less demanded).
Which causes a SHIFT of the demand curve (not a movement along it)?
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Income is a non-price factor, so it shifts the whole curve.
Which factors shift the demand curve? (Select all that apply.)
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Income, tastes and advertising shift the curve; the own price moves you along it.
Shifts in demand
- A change in a non-price factor shifts the whole curve: income 收入, tastes 偏好, prices of related goods, population, advertising.
- Right shift = more demanded at every price; left shift = less.
A change in income, tastes or related prices shifts the whole demand curve right or left
Movement vs shift. Only the good's own price moves you along the curve. Everything else (income, tastes…) shifts the whole curve. Mixing these up is the most common demand error.
You've got it
- demand = willing and able to buy at each price
- law of demand: price down → quantity demanded up (curve slopes down)
- own price → move along; other factors → shift the curve