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Understanding marketing and strategy
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What is demand, exactly? Ever wondered about that? Well, in this video, we set out to answer that question.
In the simplest terms, demand is the amount of goods or services people want to buy. Demand is determined by 5 key factors. Firstly, the price of the product or service influences the demand. Generally, the lower the price, the higher the demand. Secondly, the prices of related products or services also affect the demand. If the price of a product or service falls, the demand for a complementary product or service rises. And if the price of a product or service falls, the demand for the substitute product or service also falls. Next, the income levels of people determine the demand. Generally, the higher the income levels, the greater the demand. The preferences of buyers also drives the demand. Lastly, the expectations that buyers have about the price impact their demand for it. If they expect the prices to rise, they will buy and stock up more now, leading to increased demand. So, that covers the fundamentals of demand. Keep going with Smart Money to continue your learning journey.