Syllabus: Pearson - A Level Business
Module: 1.2 Market
Lesson: 1.2.1 Demand

Introduction

This lesson supports delivery of Pearson Edexcel A Level Business, Theme 1: Marketing and People, specifically section 1.2.1 Demand. It forms part of the foundational understanding of how markets function and is a stepping stone to more complex analysis later in the course. Teaching this well is essential, not just for assessment success, but because demand analysis underpins students’ ability to think critically about real-world business activity and policy.

Key Concepts

The Pearson A Level syllabus outlines the following under 1.2.1 Demand:

• Demand: The quantity of a good or service that consumers are willing and able to buy at given prices in a given time period.

• Movement along the demand curve: Caused by a change in price.

• Shifts in the demand curve: Caused by non-price factors (conditions of demand), including:

  • Changes in consumer incomes

  • Advertising and branding

  • Price changes of substitute or complementary goods

  • Changes in consumer tastes

  • Demographic shifts

• Diminishing marginal utility: The reason why the demand curve slopes downwards. Each additional unit of a good provides less added satisfaction.

• Use of demand curve diagrams to show both movements and shifts.

These concepts are visual, applicable and lend themselves well to active, discussion-based teaching.

Real-World Relevance

Helping students make connections between theory and the world around them is key to engagement. Here are a few timely examples:

• Streaming subscriptions: As the cost of living has risen, many households have reduced or cancelled streaming services like Netflix and Disney+. This reflects a decrease in demand due to reduced disposable income.

• Electric vehicles (EVs): Government subsidies and rising petrol prices increased demand for EVs. However, demand softened in 2024 due to reduced incentives and cost concerns, leading to a leftward shift in the demand curve.

• Air fryers and energy-efficient cooking tools: Demand surged during the energy price crisis. Social media trends and perceived savings drove the shift — classic examples of non-price demand influences.

These mini case studies make lessons feel current, relatable, and exam-ready.

How It’s Assessed

In Pearson Edexcel A Level Business, demand is assessed across a range of question styles:

• Multiple choice (e.g., identifying what causes a shift in demand)

• Short-answer and explain questions (e.g., explain how a change in income affects demand for a normal good)

• Data response questions often include graphical analysis and contextual application

• Extended response (e.g., “Assess the impact on a firm of falling demand for its products”)

Command words include:

• Define – for stating concepts precisely

• Explain – often requires use of chains of reasoning

• Analyse – breaking down into components, often using diagrams

• Evaluate – weighing arguments and making judgments, typically in 10 or 12-mark questions

Students should be comfortable interpreting demand curves, applying them to real scenarios, and justifying business decisions using demand theory.

Enterprise Skills Integration

Enterprise Skills lessons and simulations build confidence in:

• Decision-making: Students use demand knowledge to make pricing and marketing decisions in simulations.

• Problem-solving: Identifying and responding to demand shifts is a recurring task in simulation-based activities.

• Numeracy and graph interpretation: Skills like plotting curves or interpreting percentage changes prepare students for both assessment and real business decision-making.

• Critical thinking: Students weigh the impact of external influences on demand and consider possible firm responses.

Using Enterprise Skills’ Business Simulations as a module reinforcement tool helps students move from abstract knowledge to active application — for example, adjusting pricing in response to a simulated drop in demand.

Careers Links

This topic links directly to Gatsby Benchmark 4 (Linking curriculum learning to careers):

• Marketing and Sales Roles: Understanding demand informs decisions about pricing, promotion, and product development.

• Market Research Analysts: Use demand data to forecast trends.

• Entrepreneurs: Must gauge and respond to consumer demand as part of everyday decision-making.

• Economists and Policy Analysts: Interpret shifts in demand to advise governments and firms.

Running a Business Simulation Competition or embedding demand analysis into a project gives students hands-on insight into these roles — ticking Gatsby Benchmarks 5 and 6.

Teaching Notes

Here’s what works in real classrooms:

• Start with a visual hook: Use Google Trends or supermarket price tags to illustrate shifts and movements before introducing the curve.

• Use ‘Which Curve?’ cards: Give students scenarios (e.g. “a new study links energy drinks to health risks”) and ask them to identify and draw the demand shift.

• Misconception alert: Many students confuse movements along the curve with shifts — reinforce that price changes move us along the curve; all other factors shift it.

• Extension task: Ask students to research and present a short case study on demand shifts in a product category of their choice (e.g. fashion, tech, food).

And if you’re short on time? The Skills Hub offers plug-and-play tools that visually reinforce demand concepts, ideal for starter activities, flipped learning, or revision.