Economics, 3rd Edition

quantity demanded

 the amount of a good that buyers are willing and able to purchase at different prices

law of demand

 the claim that, other things equal (ceteris paribus) the quantity demanded of a good falls when the price 

of the good rises

We can represent the relationship between the price and quantity demanded in a table such as the one 

shown in Figure 3.1. The table shows how many litres of milk Rachel is willing and able to buy each month 

at different prices for milk. If milk is free, Rachel would be willing to buy 20 litres. At 

€0.10 per litre, Rachel 

would be willing to buy 18 litres. As the price rises further, she is willing to buy fewer and fewer litres. 

When the price reaches 

€1, Rachel would not be prepared to buy any milk at all. This table is a