The price of a product falls. What happens?

there is an extension in demand, along the curve. A change in the product's own price moves along the curve. A lower price gives an extension.

Which would shift the demand curve for cinema tickets to the right?

a rise in consumers' incomes. More income means more tickets bought at every price. The wages of staff affect supply.

Tea and coffee are substitutes. The price of coffee rises. What happens to the demand for tea?

It increases. Some coffee drinkers switch to tea.

Which pair are complements?

phones and phone chargers. Complements are used together. The other pairs are alternatives to each other.

Why does a demand curve usually slope downwards?

Consumers are willing and able to buy more at lower prices. As price falls, more people can afford the product and want to buy it.

Demand · Edexcel IGCSE Economics 4EC1 revision

In plain words

Demand is how much of a product people are willing and able to buy at each price. Wanting something is not enough: you must also be able to pay.

When the price goes up, people usually buy less, so a demand curve slopes down from left to right. A market is anywhere buyers and sellers come together to exchange.

5 things to know

Market demand is the total of all the individual consumers' demand at each price.
A change in the product's own price causes a movement along the curve: an extension (more bought at a lower price) or a contraction (less bought at a higher price).
A change in anything else shifts the whole curve: right for an increase in demand, left for a decrease.
Things that shift demand: income, tastes and fashion, advertising, the price of substitutes, the price of complements, and population (its size and its ages).
Substitutes are alternatives (tea and coffee). Complements are used together (printers and ink).

Worked example

The price of butter rises. What happens to the demand for margarine, a substitute?

Butter is dearer, so some people switch away from it.
They buy margarine in its place, at every price of margarine.
The demand curve for margarine shifts to the right: an increase in demand.

Tips and tricks

The golden rule: a change in the product's own price is never a shift. It is a movement along the curve.
Use the right words. Extension and contraction are movements along the curve. Increase and decrease are shifts.

5 questions, about 2 minutes.

It lands in your notebook with its questions as flashcards.

Demand: 5 questions and answers

These are the quiz’s questions. Do the quiz first, then come back here for the ones that got you.

The price of a product falls. What happens?
- demand increases, and the curve shifts right
- there is an extension in demand, along the curve (the answer)
- there is a contraction in demand, along the curve
- demand decreases, and the curve shifts left
A change in the product's own price moves along the curve. A lower price gives an extension.
Which would shift the demand curve for cinema tickets to the right?
- a fall in the price of cinema tickets
- a rise in the price of cinema tickets
- a rise in consumers' incomes (the answer)
- a rise in the wages of cinema staff
More income means more tickets bought at every price. The wages of staff affect supply.
Tea and coffee are substitutes. The price of coffee rises. What happens to the demand for tea?
- It increases. (the answer)
- It decreases.
- It contracts.
- Nothing.
Some coffee drinkers switch to tea.
Which pair are complements?
- butter and margarine
- buses and trains
- phones and phone chargers (the answer)
- beef and chicken
Complements are used together. The other pairs are alternatives to each other.
Why does a demand curve usually slope downwards?
- Firms supply more at higher prices.
- Consumers are willing and able to buy more at lower prices. (the answer)
- Incomes fall when prices fall.
- Costs fall as output rises.
As price falls, more people can afford the product and want to buy it.

5 questions

Tap an answer and you’ll see straight away whether it’s right, and why.

Worksheet

3 questions, 7 marks. Write your answers on paper, then check them.

Demand

Edexcel International GCSE Economics 4EC1 · 7 marks · papermunch.org

Name ______________________________ Date ______________

Define demand.[2]
Show answerHide answer
The quantity of a product that consumers are willing and able to buy at a given price in a given time.
I got this one
State two causes of an increase in the demand for bicycles.[2]
Show answerHide answer
Any two of: higher incomes, a successful advertising campaign, a rise in the price of bus fares or petrol, cycling becoming more fashionable, a larger population.
I got this one
Explain the effect on the demand for petrol of a rise in the price of cars.[3]
Show answerHide answer
Cars and petrol are complements. Dearer cars mean fewer are bought and driven, so less petrol is wanted at every price: the demand for petrol decreases, and its curve shifts left.
I got this one

Answers: Demand

1. The quantity of a product that consumers are willing and able to buy at a given price in a given time.
2. Any two of: higher incomes, a successful advertising campaign, a rise in the price of bus fares or petrol, cycling becoming more fashionable, a larger population.
3. Cars and petrol are complements. Dearer cars mean fewer are bought and driven, so less petrol is wanted at every price: the demand for petrol decreases, and its curve shifts left.