Other Factors Anything that affects the individuals willingness and ability to make a purchases will change the demand. The Demand Function Demand functions mathematically summarize the demand relationship. Explicit demand functions define the specific mathematical relationships among the variables. The demand function shown above is a linear demand function is the relationship between and quantity demanded and the demand shifters are constants. Demonstration Problem 2-1 Inverse demand functions.
Demand is specified as quantity being a function of price.
The demand relationship is usually illustrated with price being a function of the quantity. The traditional graph of the buyer side of the market is the inverse of the demand function. Consumer Surplus Consumer surplus is the difference between what the consumer would be willing to pay to purchase a given quantity of a good and what the consumer actually pays to purchase a given quantity of a good. The height of the demand curves shows the most the consumer would pay to purchase a given unit of the good. The area under the demand curve shows the most the consumer would pay to purchase a given quantity of the good.