Assignment 2

Assignment 2
(e) Shift in the entire demand curve vs. movement along the demand curve
Change in demand means the same price, consumers want to buy more. Moving along the demand curve occurs after price fluctuations.
5.1 Movement along the demand curve
The change in price causes movement along the demand curve.
Shift in the Demand Curve

As the price of $16 in the $12 increases, the movement occurs according to demand curves, and the number of demand drops from 80 to 60.
The price change does not alter the demand curve – we only move from one point of demand curve to another.
Shift in the Demand Curve

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The change in demand curve occurs when the overall demand curve moves to the right or left. For example, sales increase means that people can afford to buy more gadgets even at the same price.
The request curve can be changed to the right for the following reasons:
• became more popular (for example, long changes or successful ad campaigns)
• Increase the price of a good replacement.
• The price of a good addition declined.
• Increase in revenue (assuming good, positive to be happy)
• Seasonal factors
Higher price evaluations result in shifts and more movement.
If the price of gasoline increases, there will be movement according to the demand curve, to buy fewer amounts. However, demand for gasoline tends to be very inelastic, which can lead to a slight decline in demands.

In the long run, the demand curve can be shifted to the left because people respond to the highest price, for example, they buy an electric car and therefore no longer need gasoline.


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