Consumer demand and price

The relationship between price and quantity demanded is the starting point for building a model of consumer behaviour. Measuring the relationship between price and quantity demanded provides information which is used to create a demand schedule, from which a demand curve can be derived. Once a demand curve has been created, other determinants can be added to the model.

Determinants of demand

Demand schedules

A demand schedule shows the relationship between price and demand over a hypothetical range of prices. For example, the schedule opposite is based on a survey of college students who indicated how many cans of cola they would buy in a week, at various prices. 

PRICE (£) QUANTITY DEMANDED
1.10 0
1.00 100
90 200
80 300
70 400
60 500
50 600
40 700
30 800

See: demand curves

See: shifts in demand