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price on the y axis
and 
quantity demanded on the x axis. 
If we assume that there is complete divisibility, so that price and quantity can both change in infinitely 
small steps, we can draw a demand curve by joining the points represented in the schedule by a 
continuous line (Figure 1). This is the household's demand curve for biscuits in the particular market we 
are looking at. 
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PART A: THE BUSINESS ORGANISATION, ITS STAKEHOLDERS AND THE EXTERNAL ENVIRONMENT 
 
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Figure 1 Graph of a demand schedule 
The area of each rectangle in Figure 1 represents consumers' total money outlay at the price in question. 
For example, at a price of $6, demand would be 1 kilogram and total spending would be $6, 
represented by rectangle ABCO. Similarly, at a price of $2, demand would be 8 kilograms and the total 
spending of $16 is represented by rectangle GEFO. 
In Figure 1, the demand curve happens to be a straight line. Straight line demand curves are often used 
as an illustration in economics because it is convenient to draw them this way. In reality, a demand 
curve is more likely to be a curved line convex to the origin. As you will be able to appreciate, such a 
demand curve means that there are progressively larger increases in quantity demanded as price falls 
(Figure 2). This happens because of the fall in marginal utility experienced as consumption of a good 
increases. 
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Figure 2 Demand curve convex to the origin