# Demand Curve

## Demand Curve

### Meaning

The demand curve is a graphic presentation of a demand schedule. It relates quantity demanded of a commodity to its prices. At higher prices less of the commodity is demanded, and at lower prices more of the commodity is demanded. As we move from higher prices to lower prices, we move down the demand curve, and as we move from lower prices to higher prices, we move up the demand curve. In other words, a change in the price of commodity means a movement along the demand curve.

### Definition

The demand curve represents the maximum quantities per unit of time that consumers will take at various prices.

-Leftwitch

The curve, which shows the relation between the price of a commodity and the amount of the commodity that the consumer wishes to purchase, is called demand curve.

-Lipsey

### Types of Demand curve

1. Individual DC
2. Market DC

1. Individual DC

It is the graphical presentation of individual demand schedule. Individual DC is a curve that shows different quantities of a commodity demanded by an individual consumer. Figure 1 represents individual demand curve. On OX axis indicates quantity demanded and on OY axis , the price. DD is the demand curve. Each point on the demand curve expresses the relation between price and demand. At a price of Rs. 5 per unit, demand is for 1 unit and at price of Rs. 1 per unit, demand is for 5 units. The DC slopes downwards from left to right, meaning thereby that when price is high demand is low and when price is low demand is high.

1. Market DC

It is the graphical presentation of market demand schedule. It is a curve that represents the aggregate demand of all the consumers in the market at different prices at different prices of a particular commodity. It is horizontal summation of individual DC. Figure 2 shows market DC as based on table 2.

Table 2.

 Price of commodity ‘X’ (in Rs.) Demand of A Demand of B Market Demand (Units) 1 4 5 4+5 =9 2 3 4 3+4 = 7 3 2 3 2+3 = 5 4 1 2 1+2 =3

In figure 2 quantity demanded is shown on OX-axis and price on OY-axis. In Fig.
i. Demand curve of ‘A’
ii. Demand curve of ‘B’
iii. Market demand curve
When price is Rs. 4.00 per unit, ‘A’ demands 1 unit and ‘B’ demands 2 units. If they are the only two consumers in the market, then the market demand will be 1 +2 =3 units. By horizontal summation of individual DC one gets market demand curve. Its slope is also negative.

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