Demand - Discrete Goods

Discrete Goods

In some cases it is impractical to represent the relationship between price and demand with a continuous curve because of small quantities demanded. Goods and services measured in small units are best represented with a smooth curve. Examples include food measured in calories and leisure measured in minutes. However, when the price of a good is very high in proportion to a consumer's budget there is a need to incorporate this limitation in both the mathematical analysis and the graph representing the relationship. While cars and houses are discrete goods for most people, cheaper goods such as glasses and bicycles are discrete goods only for the very poor. On the national level, nuclear power plants or space stations may be considered discrete goods. The concept is more useful at the individual consumer's level than at the consumers' aggregate level, because for example the difference between 3,000,000 cars demanded and 3,000,001 cars demanded is so little that the market demand for cars can be viewed as essentially continuous.