Meaning of Demand Schedule
The demand schedule refers to a table that exhibits the association stuck between the price of a commodity and the quantity demand of that commodity. It means that the demand schedule refers to the tabular statement that states different quantities of a commodity that would be demanded at different prices in a given time. A demand schedule is if presented in a graph it will show us the demand curve. The demand schedule may be of individual and market demand schedule.
Thus there are two types of the demand schedules. They are as follow;
- Individual Demand Schedule
- Market Demand Schedule
Individual Demand Schedule
It states various quantities of a commodity that a consumer or a household would buy at various prices in a given time. Therefore, the individual demand schedule shows a table in which the behavior of an individual in terms of quantity demand at different prices is presented. With the help of such an individual demand schedule, the individual demand curve can be derived. A hypothetical demand schedule of an individual or a household is given below;
|Prices of Orange (in Rs.)||Quantity Demanded (in KG)|
According to the above table/schedule suppose a family can afford to purchase 50 kg of orange a week at Rs. 10 per kg. If the price increases and becomes Rs. 20 per kg, this individual may not be able to purchase the previous level of orange and reduces demand up to 40 kg a week. Similarly, if the price increase keeps continues then the consumer also keeps reducing his or her quantity demand for orange. Following the same, if the price becomes Rs. 50 per kg then the consumer will prefer only 10 kg of mango a week. It means higher prices will compel the individual to cut down the consumption further.
Market Demand Schedule
The market is the collective form of its participants. Thus the schedule or table that shows the demand for the whole market for a commodity at different prices is known as the market demand schedule. It is an aggregate of individual demand schedules. If we add demand made by all the consumers at a certain price then we will get the market demand of that particular product at a particular price. Let us assume that there are only three consumers in the market as Robert (R), Muller (M), and James (J). Their demand for orange at different prices can be stated by the following demand schedule or table;
|Prices of Orange (in Rs.)||Demanded by Robert (R)||Demanded by Muller (M)||Demanded by James (J)||Market Demand (R+M+J)|
According to the above schedule, the market demand schedule is constructed by adding three individuals’ demand schedules given at different prices. We find that at a price of Rs. 50 per kg, 60 kg of orange is demanded in the market. Similarly, at Rs. 40 per kg, 90 kg of mango is demanded. If the price decreased to Rs. 10 per kg, the market demand is 180 kg. The market demand schedule also shows a negative relation between the price of a commodity and the quantity demand of the commodity.
Therefore the demand schedule is used to explain the demand curve. If we draw the demand curve from the above market demand schedule it will give us the graphical explanation of the law of demand. The demand schedule may be for either individual and for the market. Thus the aggregate of individuals’ demand schedules generates the market demand schedule.