Syllabus: SQA - Higher Course Spec Economics
Module: Economics of the Market
Lesson: Theory of Demand

Introduction

This lesson on the Determinants of Demand fits within the SQA Higher Economics course, under the “Economics of the Market” unit. It’s designed to help students understand why people buy what they buy—and how these decisions shift depending on external factors. Aligned with the official SQA specification, this topic builds on students’ earlier knowledge of demand curves and prepares them to explain real consumer behaviour using core economic ideas.

For teachers and SLT, it ticks key curriculum boxes, supports assessment objectives, and opens space for real-world application—all without needing to reinvent the wheel.

Key Concepts

Students are expected to learn and apply the following syllabus-aligned concepts:

• Demand Curve Basics: Recognising that demand shows the quantity of a good or service that consumers are willing and able to buy at different prices.

• Movement Along the Demand Curve: Triggered by a change in price, leading to an expansion or contraction in quantity demanded.

• Shifts in the Demand Curve: These occur when factors other than price change—leading to an increase or decrease in demand at every price level.

• Determinants of Demand:

  • Income: More disposable income generally means increased demand.

  • Price of Other Goods: Substitutes (like tea and coffee) and complements (like printers and ink).

  • Tastes and Fashion: Often influenced by trends, media, or social changes.

  • Advertising: Can boost product awareness and desirability.

  • Population: A growing population tends to increase demand, particularly for essentials.

Students must also link changes in these determinants to shifts in the demand curve and discuss the resulting impact on market equilibrium.

Real-World Relevance

This topic gives students tools to decode daily headlines and shopping trends. For example:

• Streaming Services: The pandemic saw a shift in consumer preference towards Netflix and Disney+. As people stayed home, demand rose not due to price but due to changes in lifestyle—highlighting the role of external determinants.

• Electric Cars: Increasing concern for the environment (taste), falling costs, and government incentives (external policy) have shifted demand upward.

• Fashion Influencers: A single viral post can shift tastes, and with it, demand curves for specific products.

By grounding theory in observable patterns, students can see how economics isn’t abstract—it’s all around them.

How It’s Assessed

Assessment for this topic in the SQA Higher specification typically includes:

• Short-answer and structured questions testing students’ ability to:

  • Identify determinants of demand.

  • Illustrate changes using demand curves.

  • Explain how changes in non-price factors shift demand.

• Data interpretation: Students may be given demand schedules or graphs and asked to analyse what’s changing and why.

• Command words such as “describe,” “explain,” and “analyse” are common. Students must understand how to respond with accuracy and appropriate depth.

• Application to real-world contexts is expected, so using up-to-date examples in teaching helps students feel prepared.

Enterprise Skills Integration

Exploring determinants of demand naturally leads into enterprise thinking. Students are asked to:

• Interpret consumer behaviour and apply it to decision-making.

• Problem-solve: How should a business react when demand shifts?

• Predict outcomes based on market data.

• Communicate economic reasoning, developing analytical writing that links cause to effect.

This supports key enterprise skills such as decision-making, critical thinking, and adaptability.

Careers Links

Understanding demand is crucial in roles such as:

• Marketing Analyst: Analysing what drives customer behaviour.

• Retail Buyer: Forecasting which products will sell, and when.

• Entrepreneur: Gauging customer needs and responding effectively.

• Economist or Policy Advisor: Using demand trends to recommend or design policy.

This lesson supports Gatsby Benchmarks 4 (Linking curriculum learning to careers) and 5 (Encounters with employers), especially if brought to life with guest speakers or case studies from local businesses or retail sectors.

Teaching Notes

• Use real-time data where possible—Google Trends, supermarket flyers, or student-generated surveys can anchor lessons in reality.

• Graphing practice is essential: Use mini whiteboards, Google Sheets, or graph paper to keep it active.

• Common pitfalls:

  • Confusing movement along the curve with a shift.

  • Forgetting that price doesn’t shift the demand curve.

  • Overgeneralising determinants without explaining how they affect demand.

• Extension tasks: Students could analyse demand determinants for different demographics or design a marketing strategy that increases demand based on one specific factor (e.g., using advertising or tapping into a social trend).

• Cross-curricular links: There’s room here to collaborate with Business Studies, Geography (demographics/population trends), or even Psychology (consumer behaviour).