Give reasons or explain the following statements.
1. All desires are not demand.
ANSWER:
Desires refer to those wishes that a human being cherishes such as to walk on the moon, to be a billionaire and to buy a Rolls-Royce. These wishes may not always be backed by enough finance to realise them. It is only when a desire is backed by sufficient purchasing power, along with the consumer’s readiness to spend on materialising the wish, that it becomes demand. Thus, until a consumer has sufficient money and he/she is willing to spend, a desire will remain a desire. Thus, we can say that all desires are not demand.
