Give the three reasons. 3.

Meaning: demand is not mere desire — it is desire backed by the ability to pay and the willingness to pay, at a given price and time. (The beggar's desire for a car is not demand; the officer's plan to buy a scooter is.) Determinants of demand (the "demand function" — learn as a list with symbols): 1. Price of the good itself (P) — the prime mover; 2. Income of consumers (Y) — and the good's character: normal goods (demand rises with income — meat, cars) vs inferior goods (demand falls as income rises — coarse grain, cheap noodles); 3. Prices of related goods (Pr) — substitutes (tea↔coffee: coffee's price up ⇒ tea's demand up) and complements (petrol↔motorcycles: petrol dearer ⇒ motorcycle demand falls); 4. Tastes, habits and customs (T) — festivals included: goat demand leaps every Dashain; 5. Expectations (E) — of future prices or income (rumour of a fuel shortage ⇒ queues today); 6. Population size and structure (N) — more households, more demand; a young population demands schools, an ageing one demands care; 7. Distribution of income — equal societies demand mass goods; unequal ones demand luxuries. The Law of Demand: other things remaining equal (ceteris paribus), the quantity demanded of a good varies inversely with its price. A demand schedule (individual and market) plots this;…