Economics – The allocation of resources - Demand | e-Consult

Diagram: The demand curve should be plotted with Price on the vertical axis and Quantity Demanded on the horizontal axis. Points should be plotted based on the table data and connected to form a downward-sloping curve.

Explanation: If the price fell from £5 to £3, the movement along the demand curve would be a movement up the demand curve. This is because the law of demand states that as the price decreases, the quantity demanded increases. Consumers will demand a higher quantity of the product at the lower price. The demand curve itself would not shift; it would simply be a movement along the existing curve.