Define the concept of demand and explain, on an intuitive level, why t

Define the concept of demand and explain, on an intuitive level, why the demand curve for a good is downward sloping.

What will be an ideal response?

ANSWER

Demand refers to relationship between the price of a good and the quantity consumers are willing and able to buy at each price. It is assumed that there is an inverse relationship between price and quantity demanded. The intuitive explanation is that as the price of a good falls, consumers’ purchasing power increases. At the same time, the good becomes cheaper relative to its substitutes. For these reasons, consumers are willing to buy more of the good.