Demand Curve
IntermediateA demand curve is a graph showing the relationship between the price of a good and the quantity buyers are willing to purchase at each price, with all other factors held constant.
On a typical demand curve, price is on the vertical axis and quantity on the horizontal axis. The curve usually slopes downwards from left to right, because people buy more when prices are lower.
For example, a cinema might sell 200 tickets a night at 15 each, 300 tickets at 12 and 400 tickets at 9. Plotting these points gives a falling demand curve.
A change in the product's own price causes movement along the curve. Other changes shift the whole curve. If incomes rise or a popular film is released, demand increases and the curve shifts to the right, meaning more tickets are bought at every price. If a competing streaming service launches, the curve may shift to the left.
The steepness of the demand curve reflects how sensitive buyers are to price changes. A flat curve means buyers react strongly to price, while a steep curve means they keep buying even when prices rise. This sensitivity is measured by the price elasticity of demand.
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