Demand Schedule: Individual and Market Demand Schedule - Commerce PDF Download

 
Demand schedule is a tabular statement showing various quantities of a commodity being demanded at various levels of price, during a given period of time. It shows the relationship between price of the commodity and its quantity demanded. 

A demand schedule can be determined both for individual buyers and for the entire market. So, demand schedule is of two types:

1. Individual Demand Schedule
2. Market Demand Schedule

1. Individual Demand Schedule:

Individual demand schedule refers to a tabular statement showing various quantities of a commodity that a consumer is willing to buy at various levels of price, during a given period of time. Table 3.1 shows a hypothetical demand schedule for commodity ‘x’.

Table 3.1: Individual Demand Schedule

As seen in the schedule, quantity demanded of ‘x’ increases with decrease in its price. The consumer is willing to buy 1 unit at Rs. 5. When price falls to Rs. 4, demand rises to 2 units.

A ‘Demand Schedule’ states the relationship between two variables: price and quantity. It shows that more is demanded at lower prices than at higher prices – just as you will probably buy more DVD’s when they are offered at a price less than the normal price.

Market Demand Schedule:

Market demand schedule refers to a tabular statement showing various quantities of a commodity that all the consumers are willing to buy at various levels of price, during a given period of time. It is the sum of all individual demand schedules at each and every price.

Market demand schedule can be expressed as:

Where D_m is the market demand and D_A + D_B +…………………. are the individual demands of Household A, Household B and so on.

Let us assume that A and B are two consumers for commodity x in the market. Table 3.2 shows that market demand schedule is obtained by horizontally summing the individual demands:

Table 3.2: Market Demand Schedule

As seen in Table 3.2, market demand is obtained by adding demand of households A and B at different prices. At Rs. 5 per unit, market demand is 3 units. When price falls to Rs. 4, market demand rises to 5 units. So, market demand schedule also shows the inverse relationship between price and quantity demanded.