In economics, the concept of demand is not merely the desire to own something. Demand is defined as the quantity of a good or service that consumers are willing and able to buy at various prices during a given time period. For demand to exist, three key factors must be present: the desire for a product, the ability to purchase it (which requires income or purchasing power), and the willingness to spend money on it. If any of these factors is missing, demand does not exist. Hence, demand in economics is often called "effective demand" because it requires both desire and purchasing power, along with willingness to buy. This definition highlights that demand is always price- dependent and is specifically measured over a defined time period. It differs from simple wanting or desire since demand also encompasses the ability to pay and the readiness to purchase the product at a given price. This concept is fundamental in understanding market behavior and the law of demand, which states that, all else equal, the quantity demanded of a good decreases as its price increases and increases as its price decreases.
