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AGGREGATE: A common modifier for an assortment of economic terms used in the study of macroeconomics that signifies a comprehensive, often national, total value. This modifier most often surfaces in the study of the AS-AD, or "aggregate market", model of the economy with such terms as aggregate demand and aggregate supply. For example, aggregate demand indicates the total demand for production in the macroeconomy and aggregate supply indicates the total amount of that output produced. Two other noted "aggregate" terms are aggregate expenditures and aggregate production function.
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                           DEMAND SPACE: The area on or beneath a demand curve that indicates all possible price-quantity combinations acceptable to buyers. Buyers are willing and able to purchase any price-quantity combination that places them on or below the demand curve, but not above. Demand space includes all combinations of price and quantity demanded that are acceptable to buyers. It includes every price up to the maximum demand price for a given quantity demanded. Alternatively, it includes every quantity up to the maximum quantity demanded for a given demand price.Show Me The Space| Demand Space |  |
The exhibit at the right illustrates the demand space for stuffed Yellow Tarantulas, a cute and cuddly stuffed creature from the Wacky Willy Stuffed Amigos line of collectibles. Demand space is the highlighted area below (and including) the demand curve. This space contains all price-quantity combinations acceptable to buyers.More Than A CurveWhile the demand side of the market is usually represented by a demand curve, the buying process is often best reflected by the entire demand space. Buyers can operate anywhere within this space. It could be on the demand curve itself or far below the line.The demand curve actually only represents the upper boundary of the willingness and ability to buy. Invoking the observation that people prefer more to less means that the demand price on the demand curve is the highest price, the maximum price, that buyers are willing and able to pay. However, buyers are also willing and able to pay less than the demand price for a given quantity. In fact, the lower the better. Suppose, for example, that buyers are faced with purchasing 40 Yellow Tarantulas. They are willing and able to pay $30 each, the demand price on the demand curve. Lower prices, however, are also acceptable. Is $20 each acceptable? Certainly. How about $10? No question. Are buyers willing and able to pay as little as $0? Without a doubt. All of these prices place the buyers in the demand space.
Recommended Citation:DEMAND SPACE, AmosWEB Encyclonomic WEB*pedia, http://www.AmosWEB.com, AmosWEB LLC, 2000-2025. [Accessed: January 14, 2025].
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BROWN PRAGMATOX
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Today, you are likely to spend a great deal of time searching for rummage sales hoping to buy either hand lotion, a big bottle of hand lotion or a lighted magnifying glass. Be on the lookout for attractive cable television service repair people.
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A lump of pure gold the size of a matchbox can be flattened into a sheet the size of a tennis court!
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"You don't have to be a fantastic hero to do certain things - to compete. You can be just an ordinary chap, sufficiently motivated to reach challenging goals." -- Sir Edmund Hillary, Explorer
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MR
Marginal Revenue
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