DEMAND
by Antonio C. Antonio
February 12, 2015
Demand is a market force that affects the price of a
specific good or service. Demand is
defined as an economic principle that describes a customer’s desire and
willingness to pay a price for a specific good or service. Holding all other factors constant, the price
of a good or service increases as its demand increases and vice versa.
Before proceeding further in discussing the dynamics of
economic factors and principles such as demand, let us first establish the
importance of demand to the environment and natural resources management. Part of natural resource management is the
conversion of natural resources to their economic benefits. Economic benefits for natural resources
largely dependent on economic and market forces such as supply and demand. The uplands, where most natural resources are
found, play a definitive role in providing the necessary supply to respond to
consumer demand. Consumer demand,
however, could be classified into two types; individual and market.
Demand are the various quantities of a product (goods or
services) that consumers are willing to purchase per unit time at various
prices. Absolute units could be used to
measure quantities… therefore; pieces, units, kilograms, dozens, bundles, cups,
meters, or other physical units measurement.
“Per unit time” at various prices is also considered in measuring actual
demand. Other considerations are the
purchasing power of the market and the willingness of the market to purchase
such goods and services.
Talking about demand, there is really a difference between
individual from market demand.
Individual demand is the personal preference of an individual to a
specific product (good or service). On
the other hand, market demand is the total preference of a specific market
towards a specific product. On the
supply side, the product supplied by an individual provider of a specific good
or service is called individual supply.
Market supply, on the other hand, is the aggregation of individual
supplies produced and supplied by all suppliers in a given market.
The Law of Demand states that as the price of a product
increases, the quantity demanded decreases.
This law simply states that the normal response of consumers or the
market has a lot to do with the increase or decrease in the prices for certain
goods and services. Prices and supply
play an influential role in consumer demand.
Factors affecting demand are: (a) Price; (b) Prices of related,
substitute or compliment goods; (c) Number of consumers; (d) Income of
consumers; (e) Tastes and preferences of consumers; and, (f) Range of goods available
to consumers.
Upland goods and services, like any other product in the
market, are influenced by prices, supply and demand.
Just my little thoughts…
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