You are watching: What are three characteristics of a demand curve
A need curve is a single line the represents the assorted points on a graph whereby the price that a great or organization aligns through its quantity. The is a downward curve or line that moves native left to right on a graph, wherein the vertical axis to represent price and the horizontal axis represents quantity demanded. The downward form of a demand curve indicates that, as price decreases, customers will certainly demand an ext of a product. Understanding what a need curve"s position, steep and change indicate is vital to placing it come use.
A need curve"s place refers come its placement on a graph. Since economic analysts use the very same graph to graph both a demand curve and also the related, inverse it is provided curve, the scales representing price and quantity must remain the same. If a demand curve is positioned far to the right, it shows a high amount of demand from consumer at a given price.
When a demand curve is low on the graph, it indicates that low prices create steady demand. These relative distinctions are most essential when an analyst observes a need curve"s change in position over time.
The rate of change in need over various price points provides a demand curve its slope. Need curves have the right to be concave, convex or kind straight lines. In each case, the rate of change in amount demanded as price decreases creates the changing angle of the curve.
A steep need curve way that price reductions only boost quantity inquiry slightly, if a concave need curve the flattens together it move from left to ideal reveals an increase in amount demanded once low prices drop also slightly lower.
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Shift refers to a demand curve"s change in place over time. Together the need curve move to brand-new positions top top the graph, it reveals an altering trends in consumer behavior. For example, when a demand curve falls on a graph from one measuring period to another, it shows that reduced prices create the very same level of demand as greater prices did throughout an previously measuring period. Comparing demand curves end time permits business leader to make crucial decisions about changing prices or changing supply level to maximize profit.