We've just looked at the relationship between price and quantity demanded, illustrated in table form. Now, it's time to look at this most fundamental concept illustrated as a graph. It's called the demand curve, and is one of the cornerstones of all economics. Remember though, all of this is common sense. You probably understand some of this law of demand already. It simply states, if the price of a good increases, the quantity demanded decreases. Like the table, this graph or curve will help us uncover more of the secrets behind this law. Think of it as a tool to help you visualize what's happening around you. We're going to use the information in the table to draw a demand curve, showing the negative or inverse relationship between the price of fried chicken and the quantity demanded over the period of a week. Now, I suggest that you out there watching this DVD, get yourself a piece of paper, ruler and a pencil, and do this following exercise with us. The first step is to draw the axes and indicate the origin, zero. The second step is to decide which variables are to be plotted on the axis. Since we're interested in the relationship between price and quantity demanded, we'll plot the price values p on the vertical axis and the quantity demanded qd on the horizontal axis. The next step is to indicate the price and quantity demanded intervals on each axis. From the table, we can see that there are seven different sets of figures, and so we indicate seven equally spaced intervals on our axes. So that's 1, 2, 3, 4, 5, 6, and 7 intervals, and the same again for the horizontal axis. And now, we plot the corresponding price and quantity of demanded values. We'll start with the price values. Moving up from the origin, our first value is 1rand followed by 2rand, 3rand, 4rand, 5rand, 6rand, and of course 7rand. And I do the same for the quantity demanded values, which start with the quantity of 2, and 4, 6, 8, 10, 12, and 14. Now, we can plot points that show the different price to quantity demanded combinations. According to the table, our first combination says that the price of 7rand, the quantity demanded is 2 pieces of fried chicken. This combination then is represented by this point on the diagram. And we can similarly plot the rest of the combinations. When we join all of the points to form a curve and label it D, D at each end, we have created our first demand curve.