Factors affeting Demand

Loyola, Glennson S.

SSE 108-MICROECONOMICS
 DEMAND

• The concept ‘demand’ refers to the quality of goods and services that consumers
are willing and able to purchase during a given period of time.

• Desire to buy
• Willingness to pay
• Ability to pay
Factors Affecting Demand
 Price of the Product

Price refers to the quantity of a certain good that a consumer will buy at a certain price. As
the price goes up, the demand falls down and vice versa.
 The Price of Related Goods/Substitutes.

Complementary-are goods which are consumed together or simultaneously.

Substitute-it refers when the price goes up, consumers are force to substitue products.
 Income

If the income of the consumers increases the more spending power they have.
 The Tastes and Preferences of Consumers

The demand for a commodity also depends upon the taste and preference of consumers and
changes in them over a period of time.
 The Consumer's Expectations

A commodity may be bought due to speculative reasons; if you think it might go up in the future,
you will buy now.
 The Number of Consumers in the Market

The number of buyer in a particular maket can also drive demand. When more buyers are in
the market for a good or service, the demand goes up.
 Other factors that affecting demand

• Credit facilities. This may encourage consumers to buy e

xpensive items on credit.
• Advertising can increase brand loyalty to goods and incr
ease demand.
• Quality. Quality products and services can increase the
drive of demand.
• Weather/Season.
Demanding love is not LOVE,
it is ECONOMICS
-JD GHAI
 ……

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