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Glossary
Demand Schedule

Imagine how the demand for chocolate bars at your favorite snack shop might vary in a given week depending on the price:

Price per bar Quantity of chocolate bars demanded
$2.00 100
$1.60 200
$1.20 300
$0.80 400
$0.40 500

By projecting the likely quantity of chocolate bars demanded at each possible price, we have created a demand schedule.

A demand schedule shows how much of a good or service consumers are both willing and able to buy at different prices.

Simply stated, the law of demand says that as the price of a good or service rises, the quantity demanded of that good or service falls.

Price per bar Quantity of chocolate bars demanded

Likewise, as the price of a good or service falls, the quantity of that good or service demanded rises.

Price per bar Quantity of chocolate bars demanded

Remember, only two variables are included here—price and quantity.

That's all that the law of demand includes: It states how a change in the price of a good or service affects the quantity demanded of that good or service.