Marshall's Demand Theory

Marshall's Demand Theory explains how the quantity of a good consumers want to buy depends on its price. Generally, as the price decreases, demand increases, and vice versa. This relationship is shown through the demand curve, which slopes downward. Marshall also introduced the concept of marginal utility—the extra satisfaction from consuming one more unit—and how it influences demand. When the price of a good aligns with the consumer's willingness to pay for that additional satisfaction, equilibrium is reached, determining how much of the good is bought at a given price.