What term describes the willingness and ability to pay for a good or service?

The term that describes the willingness and ability to pay for a good or service is demand. Demand represents consumer behavior in the market and reflects how much of a product or service consumers are willing to purchase at different price levels. It indicates not only a desire for a product but also the financial capability to acquire it, highlighting the importance of both willingness and ability in economic transactions.

In contrast, supply refers to how much of a good or service producers are willing to sell at various price levels, rather than the consumers' purchasing power. Quantity supplied specifically refers to the amount of a good that suppliers are willing to sell at a particular price, while quantity demanded indicates the specific amount of a good that consumers are willing to purchase at a certain price point. However, these terms do not encompass the broad concept of consumers' overall willingness and ability to pay, which is fundamentally captured by demand. This distinction emphasizes the dynamic relationship between consumer preferences and market prices.