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In the world of economics, demand and supply are the two of the most heard term as many of the main ideas of this discipline comes under the umbrella of these concepts. The law of demand is directly dependent on the law of demand, which unveils the reason and factors which make up the change in consumer’s demand. The factors income, price, substitutes, taste, and priorities let the consumer decide that what they demand for. At the same time, we observe that the necessity goods of life are cheaper, whereas the inessential or things related to luxury and comfort are usually expensive. Two of the economic terms demand and quantity demanded better explains the idea of the demand and the factors surrounding it. People often take these terms as synonyms, but in actual they are quite different terms which cover the different ideas totally. The ability of the consumer to purchase the goods or services he/she desired for is known as the demand. Conversely, the specific amount of goods and services demanded by the consumer with respect to the price in the marketplace is known as the quantity demanded.
What is Demand?
The term demands refer to the willingness of the consumer to purchase the good with respect to his/her affordability to pay for its price. The idea of the demand in the economics world better tells about the reach and capability of a consumer to buy the specific product he/she is willing to buy at the given period. If the economic goods or service is out of the reach of the consumer than it can’t be classified as the demand, at the same time, if the consumer has ‘desire’ to buy the specific good, it alone doesn’t make it the demand of the consumer. When we talk about the demand, it should have both the ideas, willingness, and affordability described. It should be kept noted that the demand is dependent on three of the elements; namely desire to buy, affordability and willingness to utilize the bought goods or services. The term demand possesses the diversity in it following it; we also talk about the term market demand which tells that what majority of consumers demand in the market. Whenever we use the term ‘desire’ in the demanding field, it also narrates about the consumers need to purchase that specific product.
What is Quantity Demanded?
The term quantity demanded tells about the customer’s demand for the specific amount of goods at a particular price at the given point in time. The quantity demanded directly depends on the price offered for that amount of goods and services, irrespective of the market condition that whether the market is in the equilibrium state or not. The principle of quantity demanded refers to the amount of the specific goods or products offered at the particular price. The idea of the quantity demanded revolves around the concept of the law of demand, which tells that the price of the product and the demand are inversely proportional to each other. In other words, we can say that it exists on the idea that if the price of the product increases the demanded decrease and vice versa.
Demand vs. Quantity Demanded
- The term demand refers to the willingness of the consumer to purchase the good with respect to his/her affordability to pay for its price. On the other hand, quantity demanded tells about the customer’s demand for the specific amount of goods at a particular price at the given point in time.
- The concept of demand depends on the affordability and desire of the consumer to buy that product. Contrary to this, quantity demanded directly depends on the price offered for that amount of goods and services.
- If the discussion is about the increase or decrease in the demand, it refers to the change in demand, whereas if the discussion is about the expansion or contraction of the demand, it means the change in the quantity demanded.
- The changes or variations in demand come due to the factors like income, the price of substitutes, and the price of complementary goods. Conversely, when the change is due to the price, then it is the quantity demanded.