The Law of Demand
Demand
AO2·Diagram required
Syllabus requirement
The inverse relationship between price and quantity demanded, assuming ceteris paribus.
Assessment objectives
AO2 Application and Analysis
Summary
This topic explains the law of demand: how the quantity demanded of a good or service depends on its price, holding other factors constant (ceteris paribus). It distinguishes effective demand (willingness and ability to pay) from mere wants, describes why demand curves slope downwards (income and substitution effects), and notes that the law applies in most cases but has exceptions.