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The need or desire for a good, service, or asset among consumers at a given price. The amount of demand at a given price is determined by supply and the availability of similar or replacements goods and services, among other factors. While demand for some staple products is relatively constant regardless of price, most of the time the price has a large influence on the level of demand. Demand for a good or service tends to increase as its price decreases. See also: Law of supply and demand, Demand curve.


the amount of a product which is purchased at a particular price at a particular point in time. A demand curve is a line showing the relationship between the price of a product and the quantity demanded per time period over a range of possible prices. Demand curves are usually downward sloping, indicating that as the price of the product falls, more is demanded. The extent to which the demand for a product will increase as price falls (and the extent to which demand will drop if the price rises) depends on the product's price-ELASTICITY OF DEMAND. The demand for a product, however, is determined also by a variety of non-price factors. A demand function attempts to incorporate all the factors that have a statistically. significant influence on demand for example, consumers' incomes, the prices of substitute products, advertising, etc. Demand curves will shift if any of these factors change over time.

In practice, firms are unable to derive definitive demand curves because of incomplete information. For this reason many firms use a COST-BASED PRICING formula for determining prices, but allow for the influence of demand by varying the profit mark-up (see DEMAND-BASED PRICING, COMPETITION-BASED PRICING).

There are various methods a firm can use to ‘forecast’ demand, including time series analysis, barometric indicators and econometric models. See SALES FORECASTING.



effective demand

the WANT, need or desire for a product backed by the money to purchase it. In economic analysis, demand is always based on ‘willingness and ability to pay’ for a product, not merely want or need for the product. CONSUMERS’ total demand for a product is reflected in the DEMAND CURVE. Compare SUPPLY.
References in periodicals archive ?
Through NVC, companies can build an agile, "adaptive" supply chain and, ultimately, reduce inventory, quicken production, and meet changing customer demands and volatile market forces.
New England also experienced record electricity demand on Tuesday, but narrowly managed to satisfy the region's power demands without tapping EnerNOC's demand response resources.
Concurrent also has deployments of the MediaHawk 4000 platform in other Cox markets including San Diego, Las Vegas and Oklahoma City, which were among the first in the industry to separate ingest, storage and streaming to meet the demands of increasing content and consumer adoption of on-demand services.
Being recognized by Supply & Demand Chain Executive three years running is a testament to our commitment and extensive expertise in tackling today's supply chain demands.
At NextLinx, meeting the demands of our valued customers and today's competitive global market has always been a top priority.
Over the past five years, there's been a power shift from manufacturers to the new 'power retailers,' including Wal-Mart and Costco, who's demands now require manufacturers to be more flexible," says JRG Chief Executive Officer Jonathon Knight.
The company's scalable On Demand video server delivers up to 120,000 simultaneous streams from a single site, without content duplication or hidden storage costs, meeting the demands of VOD today and the future content needs of Everything On Demand.
Manufacturers around the world are caught in a crossfire between increasing customer demands, mounting global competition, and financially strapped suppliers," said Andy Carlson, vice president of product marketing, PeopleSoft Manufacturing and Supply Chain Management.
Global eXchange Services offers a diverse service portfolio that we continue to refine for customers faced with evolving supply chain standards and demands.
Accelerated order lead times and meeting each customer's unique demands means our people, processes, and systems have to be highly responsive," said Ken Meidell, CIO, Cascade Designs.