Demand

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In economics, demand is referred to as the actually expressed in the market demand for goods. The demand or expressing market players are referred to as consumers. The counterpart to the demand of the offer.

Types of demand

As in economics, a large number is distinguished from markets, the term is very broad application. However, most important application is the goods market. There, the term

• In macroeconomics aggregate demand (also called " aggregate demand ", " aggregate demand " ) as a counterpart;
• In the micro- economic perspective, the sum of the individual needs of each individual market for goods, see demand ( microeconomics ).

A great importance has increased the demand on the financial markets: On the money market, the term refers to the needs of economic agents for money, the so-called money demand. On the capital market is entering a demand by the needs of borrowers of capital.

In the job market a decreasing labor demand of firms leads to unemployment if the labor supply, that is the question posed by economic agents available work force is not also declining.

The traffic demand describes the need for a change of location, which serves to fulfill a primary need. The corresponding transport infrastructure and transport services, the transport market.

Elasticity of demand

The influence of various factors on the level of demand can be measured on the elasticity.

With the direct price elasticity of demand, the different responses of demand to price changes are described. It provides information about how the demand responds to price changes. The demand may be relatively elastic, relatively inelastic, perfectly elastic or perfectly inelastic:

• Relatively elastic demand: the case of a one percent increase in the price the quantity demanded will decrease by more than 1%, ie expenditures decrease. With a cutting prices by 1%, the quantity demanded increases by more than 1%, the expenditure, ie to.
• Relatively inelastic demand: With a one percent increase in the price the quantity demanded will decrease by less than 1%, the spending increase. With a cutting prices by 1%, the quantity demanded by less than 1% increases, spending decreases.
• Perfectly inelastic demand: the demand does not respond to price changes. To raise prices, increase spending. Drop in the price, decrease spending.
• Perfectly elastic demand: prices rise, demand falls to zero.

The income elasticity of demand indicates how the quantity demanded changes when income changes. To increase incomes, demand for so-called normal goods to ( the elasticity is positive). The elasticity value indicates the extent to which increases the quantity demanded. For inferior goods, the income elasticity is negative.

• Microeconomics