Demand Shift and Changes
A change in demand refers to...
A shift of the demand curve (A shift occurs if there is a change in one of the variables- other than the price of the product- that affects the willingness of consumers to buy the product.)
A decrease in the price of a substitute causes the demand curve for a good to shift to the...
left
An increase in the price of a complement causes the demand to shift to the.....
left
Decrease in demand shifts.....
left
An increase in the price of a complementary good will shift the demand curve....
left (consumers buy less of the complementary good and less of its "partner" good.)
An increase in income (and the good is inferior) will shift the demand curve...
left (Because consumers spend less of their higher incomes on the good.)
A decrease in the price of a complement causes the demand curve for a good to shift to the......
right
An increase in the price of a substitute causes the demand curve for a good to shift to the....
right
Increase in demand shifts.....
right
An increase in income (and the good is normal) will shift the demand curve...
right (Because consumers spend more of their higher incomes on the good)
An increase in population will shift the demand curve....
right (additional consumers result in a greater quantity demanded at every price, greater population usually implies increase in demand.)
An increase in a taste for a good will shift the demand curve....
right (consumers are willing to buy a larger quantity of the good at every price.)
An increase in the price of a substitute good will shift the demand curve....
right (consumers buy less of the substitute good and more of a similar good)
An increase in the expected price of the good in the future will shift the demand curve....
right (consumers buy more of the good today to avoid the higher price in the future.)
5 Variables That Shift Market Demand
1.) Income - The income that consumers have available to spend affects their willingness and ability to buy a good. 2.) Prices of related goods - The prices of other goods can also affect consumers' demand for a product. 3.) Tastes - Taste is a catchall category that refers to the many subjective elements that can enter into a consumer's decision to buy a product. 4.) Population and demographics - As the population of a country increases, the number of consumers and the demand for most products will increase. 5.) Expected future prices - Consumers choose not only which products to buy but also when to buy them.
A change in quantity demanded refers to...
A movement along the demand curve as a result of a change in the product's price.