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Demand in trade and economics

The first is demand in trade and economics

The concept of demand is defined as the quantities of a commodity or service that consumers want to buy and are able to purchase it at different prices during a specific period of time, assuming that there are other factors that remain constant, and it is noted that demand contains three elements: the desire to buy and the ability to buy and associated with a period of time .
Distinguish between the order and the quantity requested.
Demand is the relationship between a set of hypothetical prices and the corresponding quantities demanded at those prices.
Demand then is the list of different quantities that consumers demand at different prices.
The quantity demanded represents a specific quantity of these quantities at a specific price.
Any real quantity is required under certain conditions and hence the demand differs from the quantity demanded.
Second, the law of demand prices affects the quantity demanded, not the other way around.
What happens to the required quantity when the price changes, whether it is up or down?
Based on the hypothesis of rational and rational behavior of economic units and the observation of reality, it is concluded that the relationship between the independent variable price and the quantity demanded is the dependent variable is an inverse relationship.
So the law of demand, if the price rises, the quantity demanded will decrease, and if the price falls, the quantity demanded will rise with the influence of other factors on the same thing.
Explanation of the Law of Demand: The low price attracts new consumers who were previously unable to purchase the commodity due to its high price.
The lower price causes the old consumers to buy more of it with the same amount of money.
Exceptions to the law of demand According to the law of demand, the relationship between price and quantity demanded is an inverse relationship but there are some exceptional cases in which the relationship between price and quantity demanded is a direct relationship
The first case is the case of poor commodities, which are basic commodities such as bread, sugar and rice. They are called Geffen commodities in relation to the economist Geffen, who found that the prices and demand for these commodities is the direct relationship.
The second case concerns goods that some individuals believe that an increase in their prices should be evidence that they are always well made.
When the price of these commodities increases, the demand for them increases, because the individual believes that behind this rise in price is a higher quality of the commodity and vice versa when its price falls.
The third case is the ostentatious case.
These goods are characterized by a kind of uniqueness that makes the individual accept them in particular in order to appear and distinguish from other individuals who cannot buy them due to their high price, such as jewelry, jewelry and precious stones.
The fourth case relates to the expectation situation, which is the case in which there is a decrease in the price of the good, whereby the consumer, instead of increasing the quantity demanded that he buys of the good, reduces it. , Because he expects that this drop in price will be provided by further falls that will follow.
Other factors affecting demand.
1- The consumer divides the required quantity.
The greater the income of individuals the greater their demand for commodities, and vice versa.
2- Prices of other commodities. An increase in the price of the rice commodity, for example, increases the demand for an alternative commodity such as bulgur and vice versa.
3- Increasing the population alone is not sufficient to increase the required goods and services, as they must have the purchasing power to do so.
4- Consumer tastes: Changes that happen to consumers ’tastes may lead to an increase in the quantity demanded of some commodities and a decrease in others.
5- The national income distribution method, which is the theoretical income distribution method for social classes and classes, has a great impact on the quantity demanded.
Economics is the worldwide primary governors and also the encyclopedia containing solutions to economic problems and human needs.



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