Movements along the demand curve - Changes in the good´s own price (Po)Syllabus: Explain that a demand curve represents the relationship between the price and the quantity demanded of a product, ceteris paribus.
Draw a demand curve.
If you would prefer to view this interaction in a new web window, then please follow the link below:
Ceteris Paribus - all other things remaining the same
The demand curve is drawn on the assumption that only price has changed and everything else has remained the same. This is an important assumption to note. In reality many factors are changing at the same time, but if we are to analyse the factors causing a change in the market, we first need to isolate each of the factors. This assumption, known as 'ceteris paribus' or 'other things being equal' enables us to do this.