Chapter 2: The demand curve

The demand curve

Demand can be expressed graphically. Price is plotted on the vertical axis and the quantity demanded is shown on the horizontal axis. The amount sold at each price is shown. If these points are joined up, a smooth demand curve is formed. A demand curve shows the quantity demanded at any given price. The demand curve slopes down from left to right because price and quantity demanded are inversely related.

Straight line demand curve

Straight line demand curve is to simplify the drawing of demand curves and to make it easier to understand diagrams.

Movement along a demand curve

When there is a price change, there is a movement along the demand curve. This is important because other factors that influence demand, such as income, have a different effect on the demand curve