On the graph to the right, we illustrate the effect of a price change on desired quantity demanded. In this example, we use variables rather than specific numerical values for prices and quantities.

We draw a horizontal line from the vertical axis at price P₁ until it intersects the demand curve, D, at point A. We draw a vertical line down from the demand curve to the horizontal axis to find that Q₁ is the quantity demanded at price P₁. When the price increases to P₂, we move up the demand curve to point B; quantity demanded falls to Q₂. When price falls to P₃, we move down the demand curve to point C, where desired quantity demanded is Q₃.

It might seem like a subtle difference, but we must be careful to distinguish between a change in quantity demanded and a change in demand. A change in quantity demanded means a movement along a particular demand curve due to a price change. A change in demand means the entire demand relationship has changed. A change in demand is illustrated graphically by a shift in position, and possibly of slope and curvature as well, of the entire demand curve.