You are watching: What are three characteristics of a demand curve
A demand curve is a single line the represents the miscellaneous points top top a graph where the price that a good or company aligns v its quantity. That is a bottom curve or line the moves from left to ideal on a graph, whereby the vertical axis to represent price and the horizontal axis represents amount demanded. The downward shape of a demand curve shows that, as price decreases, customers will demand an ext of a product. Expertise what a need curve"s position, steep and change indicate is crucial to putting it to use.
A need curve"s position refers to its placement on a graph. Because economic analysts use the exact same graph to graph both a need curve and the related, inverse it is provided curve, the scale representing price and also quantity need to remain the same. If a demand curve is positioned much to the right, it suggests a high quantity of need from consumer at a given price.
When a demand curve is low on the graph, it indicates that low prices produce steady demand. These relative differences are most crucial when an analyst observes a demand curve"s change in position over time.
The rate of readjust in demand over miscellaneous price points offers a need curve that slope. Need curves can be concave, convex or form straight lines. In every case, the rate of change in quantity demanded together price decreases creates the transforming angle of the curve.
A steep demand curve means that price reductions only increase quantity inquiry slightly, when a concave need curve the flattens as it moves from left to ideal reveals rise in quantity demanded once low price drop also slightly lower.
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Shift describes a demand curve"s adjust in place over time. Together the demand curve moves to brand-new positions top top the graph, it reveals changing trends in customer behavior. Because that example, when a need curve drops on a graph indigenous one measuring duration to another, it suggests that reduced prices develop the same level of demand as higher prices did during an previously measuring period. Comparing need curves end time permits business leaders to make important decisions about an altering prices or altering supply levels to maximize profit.