Demand - IGCSE - Grade 9 - and - Grade 10

Demand - IGCSE - Grade 9 - and - Grade 10

1. The Allocation of Resources Unit- 2

2. Chapter 5: Microeconomics and macroeconomics Chapter 6: The role of markets in allocating resources Chapter 7: Demand Chapter 8: Supply Chapter 9: Price determination Chapter 10: Price changes Chapter 11: Price elasticity of demand Chapter 12: Price elasticity of supply Chapter 13: Market economic system Chapter 14: Market failure Chapter 15: Mixed economic system Contents of this unit

3. DEMAND 07

4. What is demand? Demand is the willingness and ability to buy a product.

5. Demand & Price Price Demand Price Demand

6. INDIVIDUAL DEMAND Individual demand is the demand of just one consumer.

7. Market DEMAND Market demand is the total demand for a product from all its customers

8. It is a tabular presentation of customer’s demand at different price levels. Demand Schedule

9. Demand Curve

10. Extension of Demand This is an example of a demand curve for Coca-Cola. Here, a decrease in price from 80 to 60 has increased its demand from 300 to 500. The increase in demand due to changes in price (without changes in other factors) is called an extension in demand . Here the extension in demand is from A to B.

11. Contraction of Demand In the above example, an increase in price from 60 to 80, will decreased the demand from 500 to 300. The decrease in demand due to the changes in price (without changes in other factors) is called a contraction in demand . Here the contraction in demand will be from B to A.

12. Increase in demand: a rise in demand at any given price, causing the demand curve to shift to the right. Decrease in demand: a fall in demand at any given price, causing the demand curve to shift to the left.

13. Remember! A movement along the demand curve is caused by a change in price A shift of of the demand curve is caused by anything that affects demand except price: advertising, trend, new features, competition, income, social media. An outward shift of the demand curve is called an increase in demand An inward shift of the demand curve is called a decrease in demand An upward movement along the demand curve is called a contraction of demand A downward movement along the demand curve is called an expansion of demand

14. Causes of changes in demand

15. Change in income Normal Goods Demand Income Inferior goods Demand Income

16. Changes in the price of related products Substitute Goods Complementary goods