Demand effect on economic growth.

Demand is something which depends on consumer's taste. Its a principle of economic that trigger the consumer's willingness or need to pay the price for some individual article or goods. Demand increases when there is a scarcity in supply or not having enough stock which can have diversified affect on economical growth. Increase of demand can result triggering of production or increase of price.
   
 Demand depends on several things

1. Taste
2. Number and price of substitute
3. Income or per capita income
4. How subsidiary items or complementary goods are available.
5. Distribution of income
6. Expectation
7. Promotion

On basis of this several things demand curves changes and make a huge impact on economical growth or declination accordingly. Economic growth is purely dependent on some factor like

• Buying power of consumer
• Inflation of good's price
• Job growth
• Population

      Economical growth depends on consumer buying power straightly. Buying power of a consumer increases when the price of commodities goes down. A particular segment of people are comfortable of buying things to a certain prices. When price goes up the buying power goes down.

     

       Certain amount of inflation is good for a sustainable economic health. It is around 1 to 2 percent. If the economy remains healthy consumer's capability of spending increases. No inflation means stagnant economic position. This inflation comes when there is a possible demand in market.

       Economic growth also depends on job growth in a nation. The more job growth is the more there will be upgraded or mobile economy. When there will be demand there will be job growth which shows how mobile the economy is.

       Population is also a main cause of demand. The more the population increases the more the demand increases which lead us to the economic upgrade also. If the other parameter like standard of living, income, job growth and other thing remain constant then this also trigger the economic growth.