Understanding Demand Schedule
A demand schedule is a table that shows the quantity of a good or service that consumers are willing and able to buy at different prices. It helps in understanding the relationship between price and quantity demanded.
Components of Demand Schedule
- Price: The price of the good or service
- Quantity Demanded: The amount of the good or service consumers are willing to buy at that price
Example of Demand Schedule
Price (in $) | Quantity Demanded
5 | 10
4 | 15
3 | 20
2 | 25
1 | 30
Case Study: Apple iPhones
Apple releases a new iPhone model at a price of $1000. According to the demand schedule, if the price drops to $800, the quantity demanded increases to 20 units. This shows the inverse relationship between price and quantity demanded.
Importance of Demand Schedule
- Helps in pricing strategy: Companies can determine the optimal price point based on the quantity demanded at different price levels
- Forecasting sales: By analyzing the demand schedule, businesses can forecast future sales and plan production accordingly
Statistics on Demand Schedule
A study by Harvard Business Review found that companies that regularly analyze demand schedules are 15% more profitable than those that do not.
