Thursday, May 8, 2008

Demand vs. Quantity Demanded


It is extremely important to understand the difference between demand and quantity demanded.

• refers to the entire relationship between prices and the quantity of this product or service that people want at each of these prices.
• should be thought of as "the demand curve."

Quantity demanded
• refers to one particular point on the demand curve (not the entire curve).
• refers to how much of the product is demanded at one particular price.
• is the horizontal distance between the vertical axis and the demand curve.

An increase in demand versus an increase in quantity demanded

With an increase in demand:
• the demand curve shifts to the right.
• at every possible price, a greater quantity is demanded.

An increase in demand might be caused by:
• an increase in the number of consumers.
• an increase in consumers' income (for a normal good) or a decrease in consumers’ income (for an inferior good).
• an increase in the price of a substitute good.
• a decrease in the price of a complementary good.
• an increase in preference for the product (i.e., the product becomes more popular).
• expectations (e.g., that the price will be higher in the future).

With an increase in quantity demanded:
• the price of the product decreases.
• there has been a movement from one point on the demand curve to another point (further to the right) on the same demand curve.

An increase in quantity demanded is caused by:
• a decrease in the price of the product.

A demand curve illustrates how much the quantity demanded changes when the price changes.

A change in quantity demanded is represented as a movement along a demand curve.

In the diagram below, there is an increase in the quantity demanded from two to four when the price of a hamburger falls from $4 to $2. This is illustrated by the movement along the demand curve from point B to point D.

Figure 4. An illustration of an increase in quantity demanded. There is a movement along the demand curve, but the demand curve does not shift. In this graph, there is a change is the quantity demanded, but demand does not change.


  1. thank you proffesor but pls can change in price of the good in question cause a change in quantity demanded?

    1. yes it do affect quantity demanded rather both of them are interrelated t each other. In simpler words, follow the concept, "At higher price of good, quantity demanded will be low and vice-versa"

  2. its brilliant knowledge!

  3. thank you sir for such a great answer!!! it was really a great help.....

  4. Excellent Sir....

  5. Thanks for Explaining it clearly and to the point. I spent one hour listening to lectures at uni yesterday and they could not explain it. Pathetic!


  6. THANK bro, you rock SIRRRRRRRRRR. Whithout you, I would have PASSED!
    Bra you the man! yo

  7. that debt clock tho

  8. so what is the difference between demand of a product and quantity demand of a product

  9. I'm going to the store to buy milk. (consumer demand) The amount of milk I purchase depends on the price at the time I'm at the store. (quantity demanded)

  10. thank u..........soo much........

  11. Great explanation. May I know your good name professor? Do you teach online?

  12. Do you give online classes? Love to attend them!

  13. demand generation market size-In order for targeted marketing programs to drive customer acquisition, precise identification of leads, their roles, their involvement in the product function and their willingness to give appointments all testify … Read more

  14. Great ! I did get it super easy and clear.

    Thank you so much.

  15. If car price decreases, normally gas price increases and vice-verse due to being complimentary goods. Right?

  16. When can quantity demand increase as price increases???