Demand schedule

A tabular representation of the relationship between price and quantity demanded is known as the demand schedule. Demand schedule may be of two types: individual demand schedule and market demand schedule.

Individual demand schedule

It shows the quantity of the commodities that a consumer will buy at a selected price. We can take a hypothetical data of an individual consumer for a list of prices and the corresponding quantities demanded of commodity Y. It is also called household demand.

 Price (₹) Quantity (Units) 5 15 4 25 3 30 2 35 1 60

In the above table, we can see that when the price for commodity Y was ₹ 5, quantity demanded was 15 units. When the price falls to ₹ 4, quantity demanded for commodity Y raises to 25 units. Similarly, when price further falls to 1, the quantity demanded rises to 60 units. The above table shows an inverse relationship between price and quantity demanded.

Demand curve

A graphical representation of the demand schedule is known as a demand curve. Demand curve is also known as average revenue curve & marginal utility curve. The demand curve always slopes downward towards the right i.e., it has a negative slope. By plotting the above individual demand schedule, the following demand curve can be drawn. Market demand schedule

It is the summation of the quantity demanded by various households. Suppose the market for a commodity consists of three consumers, A, B and C, by adding the individual schedules of A, B, and C, the following market demand schedule is constructed.

 Price (₹) Quantity Demanded by Total market demand A B C 5 10 8 12 10 + 8 + 12 = 30 4 15 12 18 15 + 12 + 18 = 45 3 20 17 23 20 + 17 + 23 = 60 2 35 25 40 35 + 25 + 40 = 100 1 60 35 45 60 + 35 + 45 = 140

Thus, when we add the quantities demanded at various prices by each of the individual households, we get the total market demand. The market demand schedule also indicates an inverse relationship between price and quantity demanded.

Market demand curve

A graphical representation of the market demand schedule is known as the market demand curve. This curve also slopes downward from left to right as it is nothing but the lateral summation of the individual demand curves.   