Demand Curve

Overview


The demand curve is generally downward sloping. That is, as the price of a product goes up, the amount demanded goes down.

Luxury Goods


The standard demand curve given above does not always hold. In fact, luxury items often become more desirable as the price of the item goes up, even if the product does not change.

This means that luxury goods with strong brands may have a section of the demand curve that is upward sloping.

Topics


  • Price Sensitivity and Elasticity of Demand