Creating a Demand Diagram: A Step-by-Step Guide

Create demand diagram

Creating a demand diagram typically involves plotting a demand curve on a graph to illustrate the relationship between the price of a good or service and the quantity demanded by consumers. Here’s a step-by-step guide to creating a basic demand diagram:

Step-by-Step Guide:

1. Set Up Your Axes:

   • Horizontal Axis (X-Axis): Represents the quantity demanded.
   • Vertical Axis (Y-Axis): Represents the price of the good or service.

2. Label Your Axes:

   • Label the X-axis as "Quantity Demanded."
   • Label the Y-axis as "Price."

3. Plot the Demand Curve:

   • The demand curve typically slopes downward from left to right, indicating that as the price decreases, the quantity demanded increases, and vice versa.
   • To plot the curve, you need data points that show different quantities demanded at various price levels.

4. Draw the Demand Curve:

   • Connect the data points with a smooth line to form the demand curve.

Example Data Points:

Plotting the Example Data:

1. Price (Y-Axis): Mark the prices ($10, $8, $6, $4, $2) on the vertical axis.
2. Quantity Demanded (X-Axis): Mark the quantities (100, 150, 200, 300, 500) on the horizontal axis.
3. Plot Points: Plot each pair of (Price, Quantity Demanded) on the graph.
4. Draw the Curve: Connect the points with a smooth, downward-sloping line.

Visual Representation:

Price
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