It is useful to know what economists mean by the demand for the goods by consumers. The demand for a commodity is essentially consumer's attitude and reaction towards that commodity. Contents: Meaning of Demand Demand and Utility Law of Demand Market Demand Function Extension and Contraction in Demand Factors Determining Market Demand Shifts in Demand: Increase and Decrease in Demand [...]
The law of demand, as stated by Alfred Marshall, establishes a qualitative and functional relationship between price of a commodity and the quantity demanded of it. It states that, ceteris paribus, a fall in the price of a commodity increases the quantity of the commodity demanded and a rise in the price causes a fall in its quantity demanded. Marshall [...]
The following points highlight the six exceptions to the law of demand. The exceptions are: 1. Things of Prestige Value 2. Inferior or Giffen Goods 3. Complementary Goods 4. Speculative Demand 5. Using Price as an Index of Quality 6. Highly Essential Goods. Exception # 1. Things of Prestige Value: Often rich people use very high-priced goods, not out of [...]