Or…My Pet Rock Died.

Demand : the desire to have some good or service and the ability to pay for it. It isn’t enough for consumers to desire a good, if they cannot afford it. It isn’t enough for consumers to be able to afford a good, if they don’t really desire it.

When the price of a good of service falls, consumers buy more of it. (P , then Q D  ) As the price of a good or service increases, consumers buy less of it. (P , then Q D  ) Quantity demanded and price have an inverse (opposite) relationship.

A demand schedule is a table that shows how much of a good or service an individual consumer is willing and able to purchase at each possible price. market A market demand schedule shows how much of a good or service all consumers are willing and able to buy at each possible price.

Price per DVD ($) Quantity Demanded

Price per DVD ($) Quantity Demanded

A demand curve is a graph that shows how much of a good or service an individual consumer is willing and able to buy at each price. A market demand curve is a graph that shows how much of a good or service all consumers in a market are willing and able to buy at each price.

Price per DVD (in dollars) Quantity Demanded of DVDs

The Law of Diminishing Marginal Utility – the benefit from using each additional unit of a good or service during a given time period tends to decline as each is used.