The Law of Demand
Definition: The Law of Demand states that, Ceteris Paribus (all other factors being
equal), as the price of a good increases, the quantity demanded decreases. Conversely, as
the price decreases, the quantity demanded increases.
Price ↑ → Quantity Demanded ↓
Price ↓ → Quantity Demanded ↑
1. The Demand Schedule
This is a table showing the relationship between the price of a good and the quantity
demanded.
Price ($) Qty Demanded
10 20
8 40
6 60
4 80
2 100
2. The Demand Curve
The demand curve is a graphical representation of the demand schedule. It is
downward sloping from left to right, indicating an inverse relationship.
P1, Q1
Price (P)
P2, Q2
D
Quantity (Q)
Fig 1: Downward Sloping Demand Curve
Definition: The Law of Demand states that, Ceteris Paribus (all other factors being
equal), as the price of a good increases, the quantity demanded decreases. Conversely, as
the price decreases, the quantity demanded increases.
Price ↑ → Quantity Demanded ↓
Price ↓ → Quantity Demanded ↑
1. The Demand Schedule
This is a table showing the relationship between the price of a good and the quantity
demanded.
Price ($) Qty Demanded
10 20
8 40
6 60
4 80
2 100
2. The Demand Curve
The demand curve is a graphical representation of the demand schedule. It is
downward sloping from left to right, indicating an inverse relationship.
P1, Q1
Price (P)
P2, Q2
D
Quantity (Q)
Fig 1: Downward Sloping Demand Curve
