0455

Demand

Allocation of Resources · 4 question types

Individual demand is the quantity of a good one consumer is willing and able to buy at each price. Market demand is the sum of all individual demands at each price.

To build the market demand curve, the demand from every consumer is added horizontally (i.e. quantities at each price are added together). For example, if at a price of $10 one group of buyers demands 500 units and another demands 400, market demand is 500 + 400 = 900 units at that price.

Individual and market demand: at a price of $10, boys demand 500 units and girls demand 400 units, which sum horizontally to a total market demand of 900 units
Source: Individual & Market Demand by Save My Exams