Analyse how an individual consumer's demand curve for a product is derived and consider how this may be linked to its market demand.

Mark scheme

Marking points from the official mark scheme (May/June 2019). The mark or mark type is shown in brackets.

1. [12] (a) Candidates can use either a marginal utility or an indifference curve approach.
2. Marginal Utility: explanation of marginal and total utility, the equi-marginal equilibrium, the change in price of one good and the resultant establishment of the new equilibrium and its consequence for demand.
3. Indifference Curve: explanation of the shape of an indifference curve and a budget line, the point of tangency to establish demand, followed by a change in price and change in quantity, linked to an individual's demand curve.
4. The aggregation of individual's demand curves to make the market demand curve.
5. [13] (b) Analysis to show the effect of an outward shift in the budget line on the demand for a normal (positive) good and inferior (negative) good.