Distinguish between individual demand curve and market demand curve.
An individual demand curve shows different quantities of a commodity demanded at different prices within a given period by an individual household. Individual demand curve is graphical representation of an individual demand schedule. Market demand curve is graphical representation of amount of the commodity which all the cosumers in the market are willing to buy at a given price within a given period. These curves are shown below in Fig. 2.11. DD curve is market demand curve whereas A, B, C are individual demand curves. Market demand curve is derived geometrically by horizontal summation of individual demand curves in the market. It is simply the sum of individual demand curves. It shows the demand of the whole market for a commodity. Market demand curve is always a downward sloping curve to the right.
Fig. 2.11
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