ABSTRACT
Demand analysis is traditionally embedded in the theory of consumer behaviour. Various consumption hypotheses and their underlying proportions have been the focus of empirical investigations and synthesis of observed consumption behaviour. Some of the early contributors to demand analysis included King (1696), who computed a demand schedule for maize and developed King’s law based on the inverse relationship between price and the quantity demanded. In 1844 Dupuit identified utility with demand and provided an explanation of the relationship between marginal utility, total utility and price. Utility was and is still defined as the satisfaction which is derived from the consumption of some goods or services. As a person buys more of the good or services, the total utility derived from it increases. The additional utility derived from the last unit purchased is defined as marginal utility of the commodity. Generally marginal utility diminishes as consumption increases. Utility cannot be measured as it is subjective.
