Now let's see how the number of consumers in a market can affect demand. This one is pretty straightforward. If the amount of consumers in a market increases, then the demand for a good is going to increase as well, right? There are just more people who want to buy it, so the demand is going to increase. There are simply more people buying it. Here we see a directly proportional relationship as well. We've got the number of customers increasing and the demand also increasing. Here are some good examples of how the number of consumers could change:
- Immigration: If immigration is happening to our country, we're going to see a rise in our population, a rise in the number of consumers.
- Birth rate: If there's an increased birth rate, there are going to be more consumers, or a decreased birth rate, fewer consumers, right?
- Advertising: Advertising can target someone who is not a consumer of your product. They had no demand for your product, you advertise to them, and now they demand your product. So, advertising is another factor that could increase the number of consumers in a market.
Let's go ahead and do an example.