{"id":8052,"date":"2021-10-10T21:56:35","date_gmt":"2021-10-10T16:26:35","guid":{"rendered":"https:\/\/scholarsclasses.com\/blog\/?p=8052"},"modified":"2025-10-09T12:53:44","modified_gmt":"2025-10-09T07:23:44","slug":"demand-determinants","status":"publish","type":"post","link":"https:\/\/scholarsclasses.com\/blog\/demand-determinants\/","title":{"rendered":"Demand Determinants (10 Points) |  Free Economic Blogs"},"content":{"rendered":"\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_81 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-69e41b276fca3\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69e41b276fca3\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/scholarsclasses.com\/blog\/demand-determinants\/#Demand_Determinants\" >Demand Determinants<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/scholarsclasses.com\/blog\/demand-determinants\/#Meaning_of_Demand\" >Meaning of Demand<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/scholarsclasses.com\/blog\/demand-determinants\/#Definition_of_Demand\" >Definition of Demand<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/scholarsclasses.com\/blog\/demand-determinants\/#Demand_Determinants-2\" >Demand Determinants<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/scholarsclasses.com\/blog\/demand-determinants\/#1_Price\" >1) Price<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/scholarsclasses.com\/blog\/demand-determinants\/#2_Income\" >2) Income<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/scholarsclasses.com\/blog\/demand-determinants\/#3_Prices_of_Substitute_Goods\" >3) Prices of Substitute Goods<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/scholarsclasses.com\/blog\/demand-determinants\/#4_Price_of_Complementary_Goods\" >4) Price of Complementary Goods<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/scholarsclasses.com\/blog\/demand-determinants\/#5_Nature_of_product\" >5) Nature of product<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/scholarsclasses.com\/blog\/demand-determinants\/#6_Size_of_population\" >6) Size of population<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/scholarsclasses.com\/blog\/demand-determinants\/#7_Expectations_about_future_prices\" >7) Expectations about future prices<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/scholarsclasses.com\/blog\/demand-determinants\/#8_Advertisement\" >8) Advertisement<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-13\" href=\"https:\/\/scholarsclasses.com\/blog\/demand-determinants\/#9_Tastes_Habits_and_Fashions\" >9) Tastes, Habits and Fashions<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-14\" href=\"https:\/\/scholarsclasses.com\/blog\/demand-determinants\/#10_Level_of_Taxation\" >10) Level of Taxation<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2 class=\"has-text-align-center has-black-color has-text-color wp-block-heading\"><span class=\"ez-toc-section\" id=\"Demand_Determinants\"><\/span>Demand Determinants<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large is-resized\"><img decoding=\"async\" data-src=\"https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/10\/Demand-Determinants-1024x576.jpg\" alt=\"Demand Determinants\" class=\"wp-image-8072 lazyload\" width=\"768\" height=\"432\" title=\"\" data-srcset=\"https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/10\/Demand-Determinants-1024x576.jpg 1024w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/10\/Demand-Determinants-300x169.jpg 300w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/10\/Demand-Determinants-768x432.jpg 768w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/10\/Demand-Determinants-1536x864.jpg 1536w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/10\/Demand-Determinants-640x360.jpg 640w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/10\/Demand-Determinants.jpg 1920w\" data-sizes=\"(max-width: 768px) 100vw, 768px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 768px; --smush-placeholder-aspect-ratio: 768\/432;\" \/><figcaption><strong>Demand Determinants<\/strong><\/figcaption><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Meaning_of_Demand\"><\/span>Meaning of Demand<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p><strong>In ordinary language, demand means a desire. Desire means an urge to have something.<\/strong><\/p>\n\n\n\n<p><strong>In Economics, demand means a desire which is backed by a willingness and ability to pay.<br><\/strong>For example, if a person has the desire to purchase a television set but does not have adequate purchasing power then it will be simply a desire and not a demand.<br>Thus, demand is an effective desire. All desires are not <a href=\"https:\/\/www.nios.ac.in\/media\/documents\/SecEcoCour\/English\/Chapter-9.pdf\" target=\"_blank\" data-type=\"URL\" data-id=\"https:\/\/www.nios.ac.in\/media\/documents\/SecEcoCour\/English\/Chapter-9.pdf\" rel=\"noreferrer noopener\">demand<\/a>.<\/p>\n\n\n\n<p>In short,<br><strong>Demand = Desire + Willingness to Purchase + Ability to Pay.<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><a href=\"https:\/\/scholarsclasses.com\/blog\/microeconomic-definition\/\" target=\"_blank\" rel=\"noreferrer noopener\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/microeconomic-definition\/\"><strong>Microeconomic Definition | Historical Review of Microeconomics<\/strong><\/a><\/li><li><a href=\"https:\/\/scholarsclasses.com\/blog\/scope-of-microeconomics\/\" target=\"_blank\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/scope-of-microeconomics\/\" rel=\"noreferrer noopener\"><strong>Scope Or Nature of Microeconomics<\/strong><\/a><\/li><li><strong><a href=\"https:\/\/scholarsclasses.com\/blog\/features-of-microeconomics\/\" target=\"_blank\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/features-of-microeconomics\/\" rel=\"noreferrer noopener\">Features of Microeconomics<\/a><\/strong><\/li><li><strong><a href=\"https:\/\/scholarsclasses.com\/blog\/importance-of-microeconomics\/\" target=\"_blank\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/importance-of-microeconomics\/\" rel=\"noreferrer noopener\">Importance of Microeconomics<\/a><\/strong><\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Definition_of_Demand\"><\/span>Definition of Demand<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>According to Benham, \u201c<strong>the demand for anything at a given price is the amount of it, which will be bought per unit of time at that price.<\/strong>\u201d<br>Thus, following are the features of demand :<br>1) Demand is a relative concept.<br>2) Demand is essentially expressed with reference to time and price.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Demand_Determinants-2\"><\/span><strong>Demand Determinants<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The demand for goods is determined by the following factors.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"1_Price\"><\/span><strong>1) Price<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>Price determines the demand for a commodity to a large extent. Consumers prefer to purchase a product in large quantities when price of a product is less and they purchase a product in small quantities when price of a product is high.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"2_Income\"><\/span><strong>2) Income<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>Income of a consumer decides purchasing power which in turn influences the demand for the product. Rise in income will lead to a rise in demand for the commodity and a fall in income will lead to<br>a fall in demand for the commodity.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"3_Prices_of_Substitute_Goods\"><\/span><strong>3) Prices of Substitute Goods<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>If a substitute good is available at a lower price then people will demand cheaper substitute good than costly good. For example, if the price of sugar rises then demand for jaggery will rise.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"4_Price_of_Complementary_Goods\"><\/span><strong>4) Price of Complementary Goods<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>Change in the price of one commodity would also affect the demand for other commodity. For example, car and fuel. If the price of fuel rises, then demand for cars will fall.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"5_Nature_of_product\"><\/span><strong>5) Nature of product<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>If a commodity is a necessity and its use is unavoidable, then its demand will continue to be the same irrespective of the corresponding price. For example, medicine to control blood pressure.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"6_Size_of_population\"><\/span><strong>6) Size of population<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>The larger the size of population, greater will be the demand for a commodity, and smaller the size of population smaller will be the demand for a commodity.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"7_Expectations_about_future_prices\"><\/span><strong>7) Expectations about future prices<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>If the consumer expects the price to fall in future, he will buy less in the present at the prevailing price. Similarly, if he expects the price to rise in future, he will buy more in the present at the prevailing price.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"8_Advertisement\"><\/span><strong>8) Advertisement<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>Advertisement, sales promotion schemes and effective salesmanship tend to change the preferences of the consumers and lead to demand for many products. For example, cosmetics, toothbrushes etc.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"9_Tastes_Habits_and_Fashions\"><\/span><strong>9) Tastes, Habits and Fashions<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>Taste and habits of a consumer influence the demand for a commodity. If a consumer likes to eat chocolates or consume tea, he will demand more of them. Similarly, when a new fashion hits the market, the consumer<br>demands that particular type of commodity. If a commodity goes out of fashion then suddenly the demand for that product tends to fall.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"10_Level_of_Taxation\"><\/span>10) Level of Taxation <span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>High rates of taxes on goods or services would increase the price of the goods or services. This, in turn would<br>result in a decrease in demand for goods or services and vice-versa.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong><a href=\"https:\/\/scholarsclasses.com\/blog\/importance-of-law-of-diminishing-marginal-utility\/\" target=\"_blank\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/importance-of-law-of-diminishing-marginal-utility\/\" rel=\"noreferrer noopener\">Importance of Law of Diminishing Marginal Utility<\/a><\/strong><\/li><li><strong><a href=\"https:\/\/scholarsclasses.com\/blog\/utility-in-economics-meaning-concepts\/\" target=\"_blank\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/utility-in-economics-meaning-concepts\/\" rel=\"noreferrer noopener\">Utility in Economics ( Concepts of Utility )<\/a><\/strong><\/li><li><strong><a href=\"https:\/\/scholarsclasses.com\/blog\/features-of-utility\/\" target=\"_blank\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/features-of-utility\/\" rel=\"noreferrer noopener\">Features of Utility<\/a><\/strong><\/li><li><strong><a href=\"https:\/\/scholarsclasses.com\/blog\/types-of-utility\/\" target=\"_blank\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/types-of-utility\/\" rel=\"noreferrer noopener\">Types of Utility<\/a><\/strong><\/li><\/ul>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#46;&#46;&#46;<\/p>\n","protected":false},"author":1,"featured_media":8072,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[10,1],"tags":[3178],"class_list":["post-8052","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-educational-blogs","category-misc","tag-demand-determinants"],"_links":{"self":[{"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/posts\/8052","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/comments?post=8052"}],"version-history":[{"count":2,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/posts\/8052\/revisions"}],"predecessor-version":[{"id":39609,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/posts\/8052\/revisions\/39609"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/media\/8072"}],"wp:attachment":[{"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/media?parent=8052"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/categories?post=8052"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/tags?post=8052"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}