A demand curve shows the relationship between the price of a good and the quantity a consumer is willing to buy, holding other factors constant. The law of demand states the curve slopes downward: higher prices reduce quantity demanded. This is a fundamental building block for understanding consumer behavior and markets.
Plot own consumption decisions at different price points. Distinguish demand (entire relationship) from quantity demanded (point on curve). Understand the two effects: substitution (relative price) and income effect (purchasing power).
When economists say a consumer "demands" something, they mean something precise: the consumer is *willing and able* to buy a specific quantity at a specific price. Willingness alone—wanting a sports car you cannot afford—does not constitute demand. The demand curve captures this joint condition by mapping every possible price to the maximum quantity a consumer would buy at that price, holding everything else constant (income, prices of other goods, preferences).
The curve slopes downward for two reinforcing reasons. First, the substitution effect: when the price of a good rises relative to alternatives, the consumer has an incentive to swap toward substitutes—coffee gets expensive, so you drink more tea. Second, the income effect: a higher price reduces your real purchasing power, so you cut back on consumption. For most goods (normal goods), both effects push in the same direction, producing the familiar downward slope. Rare exceptions called Giffen goods have income effects so large they overpower the substitution effect, but these are theoretical curiosities.
The crucial distinction is between *demand* (the whole curve) and *quantity demanded* (a single point on it). When the price of gasoline rises, you move along the existing demand curve to a lower quantity—that is a change in quantity demanded. But if your income doubles, if gasoline prices are expected to spike next month, or if fuel-efficient cars become widely available, the entire curve shifts—you now want more or less gasoline at *every* price. Non-price factors that shift the demand curve include consumer income, prices of substitutes and complements, tastes and preferences, expectations about future prices, and the number of buyers in the market.
This individual demand curve is the building block for market demand, which is simply the horizontal sum of all individual demand curves at each price. Understanding where the individual curve comes from—and what shifts it versus what moves along it—gives you the tools to analyze everything from tax policy to advertising to the effects of recessions on specific markets.