Learning Path
Question & Answer
Choose the Best Answer
An increase in consumer income
A decrease in the price of a substitute good
A decrease in consumer preferences for the good
An increase in the price of the good
Understanding the Answer
Let's break down why this is correct
When people earn more money, they can afford more of the good. Other options are incorrect because A lower price for a substitute makes the substitute cheaper, so people switch away from the original good; If people like the good less, they buy it less.
Key Concepts
Shifts in Demand Curve
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Deep Dive: Shifts in Demand Curve
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Definition
Shifts in the demand curve occur when factors other than price influence the quantity of a product demanded at each price level. Changes in consumer income, tastes, fashion trends, and prices of related goods can shift the demand curve either outward (increase in demand) or inward (decrease in demand).
Topic Definition
Shifts in the demand curve occur when factors other than price influence the quantity of a product demanded at each price level. Changes in consumer income, tastes, fashion trends, and prices of related goods can shift the demand curve either outward (increase in demand) or inward (decrease in demand).
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