From individual demands to the market demand for a good

To this point , our focus has rested entirely on the individual consumer. For economic and business analysis, though, it is market demand that matters. How does market demand relate to the demands of individual consumers? The answer is very simple. The market demand for a good is simply the sum of all individual consumer demands for that good. To obtain this sum, take one price and find the quantity demanded by each individual at that price. Then sum these quantities to find the market demand at that price. Repeating this analysis for all possible prices, we obtain the market demand schedule.

Be the first to comment on "From individual demands to the market demand for a good"

Leave a comment

Your email address will not be published.


This site uses Akismet to reduce spam. Learn how your comment data is processed.