SENIOR HIGH SCHOOL 1 MAGELANG

Cepaka Street 1, Magelang CityPhone/Fax (0293) 362531

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Demand and Supply

Demand is a schedule of the various amounts of a product or a service that an individual is able and willing to purchase at different prices during a given period of time.

a. The Effective DemandBased on purchasing power, There are three kinds of demand.Effective demand is a demand, which is based on the purchasing power and the transaction done by a consumer. The consumer has the power to buy goods and services and he/she has done a transaction

Potential demand is a demand, which is based on the purchasing power but no transaction yet. The consumer has the power to buy goods and services but he has not done a transaction yet.2. The Potential Demand3. The Absolute DemandAbsolute demand is a demand, which is not supported with the power of buying and transaction. He has no capacity of buying goods and services because he does not have enough money.

1. INDIVIDUAL DEMANDIndividual demand is the demand that done by someone to fulfill his/her need. 2. COLLECTIVE DEMANDCollective Demand is the summation of all individual demand for a given product.

TASKMAKE EXAMPLES :

Effective DemandPotential DemandAbsolute Demand1.1.1.

2.2.2.

3.3.3.

4.4.4.

5.5.5.

THE RELATIONSHIP BETWEEN DEMAND AND PRICE

The relationship between demand and priceMarket demand for potatoes (monthly)

POINTPRICEMARKET DEMAND (Q)A20700B40500C60350D80200E100100

Quantity (tonnes: 000s)Price (pence per kg)Price(pence per kg)20Market demand(tonnes 000s)700APointA

Market demand for potatoes (monthly)Demand

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Quantity (tonnes: 000s)Price (pence per kg)Price(pence per kg)2040Market demand(tonnes 000s)700500ABPointAB

Demand

Market demand for potatoes (monthly)

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Quantity (tonnes: 000s)Price (pence per kg)Price(pence per kg)2040 60 Market demand(tonnes 000s)700500350ABCPointABC

DemandMarket demand for potatoes (monthly)

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Quantity (tonnes: 000s)Price (pence per kg)Price(pence per kg)2040 60 80 Market demand(tonnes 000s)700500350200ABCDPointABCD

DemandMarket demand for potatoes (monthly)

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Quantity (tonnes: 000s)Price (pence per kg)Price(pence per kg)2040 60 80 100 Market demand(tonnes 000s)700500350200100ABCDEPointABCDE

DemandMarket demand for potatoes (monthly)

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Based on the curve, make conclude about The law of Demand ?According to your opinion, mention the factors that affect demand!

Quantity (tonnes: 000s)Price (pence per kg)Price(pence per kg)2040 60 80 100 Market demand(tonnes 000s)700500350200100ABCDEPointABCDE

DemandMarket demand for potatoes (monthly)THE LAW OF DEMAND

At lower prices, consumers usually purchase more of the product than at higher prices

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THE LAW OF DEMAND

At lower prices, consumers usually purchase more of the product than at higher pricesTHE LAW OF DEMAND WILL BE VALID IF IN THE CETERIS PARIBUS CONDITIONCeteris Paribus is the condition when all other factors that affect demand remain unchanged

Shifts in the Demand CurveWhat will happen with the demand curve if the law of demand is not valid?

PricePOQ0Q1QuantityAn increase in demandD0

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TERIMAKASIHATAS PERHATIANNYATERIMAKASIHATAS PERHATIANNYATHANK YOU FORYOURATTENTIONTHANK YOU FOR YOUR ATTENTION

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