3 ms·
> demand remains static, How can this be an assumption? Of course demand will respond to price.
by bottled_poe 4y ago
> demand remains static,
How can this be an assumption? Of course demand will respond to price.
- viridian 4y agoDemand is a slope, not a point. Price increases left shift demand, prices decreases right shift demand. This is because more people are willing to buy a good at a cheaper price than a more expensive one. In this context demand is the total desire of the market to consume that good at all, represented by a slope that has an inverse relationship with the price axis.