Individual Demand Schedule and Curve and Market Demand Schedule

INDIVIDUAL DEMAND SCHEDULE AND CURVE AND MARKET DEMAND SCHEDULE

Individual's demand schedule and curve: Anindividual consumer's demand refers to the quantities of a commodity demanded b y him at various prices. A demand schedule is a list of prices and quantities and its graphic representation is a demand curve.

X axis-quantity demanded

Y axis- price

DD- demand curve

Explanation:

i.  The demand schedule reveals that when the price is Rs.P2, quantity demanded is Q2 units. As the price decreases to P, the quantity demanded increases t o Q.

ii. The individual demand curve focuses on the effects of a fall or rise in the price of one commodityontheconsumer'sbehavior.Theyarethesubstation and income effects.

Market demand schedule and curve: In a market, there is not one consumer but many consumers of a commodity. The market demand of a commodity is depicted on a demand schedule and demand curve. The y show the sum total of various quantities demanded by all the individuals at various prices. S uppose there are three individuals A, B and C in a market who purchase the commodity. The demand schedule for the commodity is depicted in table below.

X axis-quantity demanded

Y axis- price

DD- demand curve

Explanation:

i.  Suppose there are three individuals A,B and C in a market who buy OA,OB and OC quantities of the commodity at the price OP, as shown in panels (A),(B) and (C) respectively.

ii. In the market OQ quantity will be bought which is made up by adding together the quantities OA,OB and OC.

iii. The market demand curve D_M is obtained by the lateral summation of the individual demand curves D_A, D_B and D_c