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$10.00 Consumer Demand Curve Demand Schedule For Hamburgers Price Quantity Point $6.00 $5.00 $1.25 $1.00 0 .5 2 3

The document discusses the consumer demand curve for hamburgers, illustrating how quantities demanded change with varying prices. It presents a demand schedule and graph, showing specific points where Carl Consumer would purchase different amounts based on price changes. The demand curve is linked to the price-consumption curve, highlighting the relationship between price and quantity in market equilibrium.

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5 views1 page

$10.00 Consumer Demand Curve Demand Schedule For Hamburgers Price Quantity Point $6.00 $5.00 $1.25 $1.00 0 .5 2 3

The document discusses the consumer demand curve for hamburgers, illustrating how quantities demanded change with varying prices. It presents a demand schedule and graph, showing specific points where Carl Consumer would purchase different amounts based on price changes. The demand curve is linked to the price-consumption curve, highlighting the relationship between price and quantity in market equilibrium.

Uploaded by

lovebook888
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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consumer equilibrium and market demand | chapter four   77

Consumer Demand Curve


$10.00
Demand schedule for hamburgers
Price Quantity Point
$9.00
$6.00 0 D
$5.00 .5 C
$8.00 $1.25 2 A
$1.00 3 B

$7.00
Price of hamburgers
D
$6.00

$5.00 C

$4.00

$3.00

$2.00
A
$1.25 B
$1.00

0
1 2 3 4 5 6 7 8
Quantity of hamburgers per week

Figure 4–3
If we hold the price of tacos constant at $0.50 and the budget constraint constant at $5, we can
derive Carl Consumer’s demand curve for hamburgers by examining the quantities of ham-
burgers consumed. For example, point A here corresponds to point A in Figure 4–2, where two
hamburgers were purchased at a price of $1.25. If the price were to fall to $1, we see in both
figures that three hamburgers would be desired (point B). Point C in both figures also indicates
that Carl would consume only one hamburger every other week if the price rose to $5. Finally,
at a price of $6 per hamburger, Carl would purchase no hamburgers. A line connecting these
and other price–quantity combinations represents the consumer demand curve. The associated
demand schedule of prices and quantities corresponding to this figure also is given.

commodity consumers are willing and able to purchase at each possible price during
some specific time in a specific market, all other factors held constant. Demand may
change over time, and a careful specification of demand will include the time period
for which it applies and the specified market. Demand for the same commodity may
be different, not only in different time periods but also in different markets.
The consumer demand curve for hamburgers in Carl Consumer’s example
is illustrated in Figure 4–3. This demand curve shows that if the price of a ham-
burger were $1.25, Carl would demand two hamburgers (see point A). Point A in
Figures 4–2 and 4–3 therefore represents the same quantity demanded. The same
relationship holds for points B and C in these two figures also. Finally, as suggested
by Figure 4–3, if the price of hamburgers rises to $6 or above, the quantity of ham-
burgers demanded by Carl would fall to zero (see point D). The demand curve and
the price-consumption curve are really two sides of the same coin. The demand curve
represents price and quantity pairs in equilibrium. Price is on the Y, or vertical, axis
in this graph and quantity is on the X, or horizontal, axis. The price-consumption
curve constitutes the preliminary step to a representation of the demand curve. In
this curve, equilibrium price and quantity pairs are identified using the tangencies
of the indifference curves and budget lines. This curve then is transformed into a
demand curve.

M04_PENS3064_06_SE_C04.indd 77 12/11/14 6:11 PM

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