Law of Demand Calculator

Formula

To calculate the quantity demanded based on the Law of Demand:

\[ QD = a - (b \cdot P) \]

Where:

$ QD $ is the quantity demanded
$ P $ is the price of the good or service
$ a $ is the quantity demanded when the price is zero
$ b $ is the slope of the demand curve

What is the Law of Demand?

The Law of Demand is an economic principle that describes the inverse relationship between the price of a good or service and the quantity demanded by consumers. It states that as the price of a good or service increases, consumer demand for it decreases, and vice versa, assuming all other factors remain constant. This law illustrates the consumer behavior of purchasing less of a product when its price rises, and more when its price falls.

Example Calculation

Let's assume the following values:

Price of the Good or Service $ P $ = $10
Quantity Demanded when Price is Zero $ a $ = 100 units
Slope of the Demand Curve $ b $ = 2

Step 1: Calculate the quantity demanded:

\[ QD = 100 - (2 \cdot 10) = 100 - 20 = 80 \text{ units} \]

So, the quantity demanded is 80 units.