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demand curve

demand curve in Culture

demand curve definition


A mathematical curve, drawn on a graph, that represents what the demand for a commodity would be if its price ranged anywhere from zero to infinity. The point at which it intersects the supply curve for the same commodity supposedly establishes the price of the commodity in a free market. (See supply and demand.)

The American Heritage® New Dictionary of Cultural Literacy, Third Edition
Copyright © 2005 by Houghton Mifflin Company.
Published by Houghton Mifflin Company. All rights reserved.
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Encyclopedia Article for demand curve

in economics, a graphic representation of the relationship between product price and the quantity of the product demanded. It is drawn with price on the vertical axis of the graph and quantity demanded on the horizontal axis. With few exceptions, the demand curve is delineated as sloping downward from left to right because price and quantity demanded are inversely related (i.e., the lower the price of a product, the higher the demand or number of sales). This relationship is contingent on certain ceteris paribus (other things equal) conditions remaining constant. Such conditions include the number of consumers in the market, consumer tastes or preferences, prices of substitute goods, consumer price expectations, and personal income. A change in one or more of these conditions causes a change in demand, which is reflected by a shift in the location of the demand curve. A shift to the left indicates a decrease in demand, while a movement to the right an increase. Compare supply curve.

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Encyclopedia Britannica, 2008. Encyclopedia Britannica Online.
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