Multiple Choice
Which of the following would cause the demand curve for coffee to shift to the right (increase in demand)?
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3. The Market Forces of Supply and Demand
Shifts in the Demand Curve
Multiple Choice
Which of the following would cause the demand curve for a normal good to shift to the right (increase in demand), holding the good’s own price constant?
A
A decrease in the price of the good (movement along the curve)
B
An increase in consumer income
C
An increase in the good’s own price
D
An increase in the good’s supply due to lower input prices
Verified step by step guidance1
Understand that a demand curve shows the relationship between the price of a good and the quantity demanded, holding other factors constant.
Recognize that a movement along the demand curve occurs when the price of the good itself changes, causing quantity demanded to change but not shifting the curve.
Identify that a shift in the demand curve means a change in demand at every price level, caused by factors other than the good's own price, such as consumer income, tastes, prices of related goods, etc.
Recall that for a normal good, an increase in consumer income leads to an increase in demand, shifting the demand curve to the right.
Note that changes in the good's own price cause movements along the curve, and changes in supply affect the supply curve, not the demand curve.
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