DEMAND
Demand: the quantity of a product that consumers are able and willing to purchase at various prices over a period of time
Market: where or when buyers and sellers meet to trade or exchange products.
It is important to remember that a want and demand are entirely different what consumer’s want they may not actually purchase.
Notional Demand: The desire for a product
Effective Demand: The willingness and ability to buy a product
The definition of demand assumes that the only factor affecting demand is price, economists refer to this as ceteris paribus
Ceteris Paribus: Assuming other variables remain unchanged
The relationship between demand and quantity is INVERSE
CONSUMER SURPLUS:
In every market there are always people who are willing to pay above what they actually pay.
Consumer Surplus: the extra amount that a consumer is willing to pay for a product above the price that is actually paid!
Diagram:

The determinants of Demand
Consumer Income
Real disposable Income: income after taxes on income have been deducted, state benefits have been and added AND the result is adjusted to account for changes in prices!
For Example:
If the money I receive from my job increases by 5% but prices also increase by 3% then my real income only increases by 2%

Therefore if consumer income increases then so does demand but if it falls demand falls because they lose the ability to pay for the good.

Normal Goods: goods for which an increase in income leads to an increase in demand, they also have a positive income elasticity of demand.

Inferior Goods: goods for which an increase in income leads to a fall in demand

It is difficult to generalise with inferior goods because it is different for different people.

The Price of other products:

The demand for a product can be affected by a change in price for another different product