Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
Increase in consumer income
B
Decrease in the price of the product
C
Change in consumer tastes towards the product
D
Increase in the price of a complementary good
E
Increase in the number of consumers in the market
Understanding the Answer
Let's break down why this is correct
Answer
A demand curve shifts when something about the market changes, not when the price of the product itself changes. Factors that can shift it include a change in the price of a substitute or complementary good, a change in consumer income, a change in tastes or preferences, a change in expectations about future prices or income, or a change in the number of buyers. These shifts move the entire curve left or right, showing a higher or lower quantity demanded at each price. For example, if a new health study shows that eating apples reduces heart disease, more people will want apples, so the apple demand curve shifts to the right.
Detailed Explanation
When people earn more money, they can buy more of a normal good, so the whole demand curve moves to the right. Other options are incorrect because Lowering the product’s own price does not change the willingness to buy at each price; it only causes a movement down the existing demand curve.
Key Concepts
Demand Shifts
Consumer Behavior
Market Dynamics
Topic
Shifts in Demand Curve
Difficulty
easy level question
Cognitive Level
understand
Practice Similar Questions
Test your understanding with related questions
1
Question 1Which of the following scenarios best illustrates how both demand and supply factors can influence the price of a product in a competitive market?
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Question 2Which of the following events would most likely cause a rightward shift in the demand curve for a normal good?
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3
Question 3If consumers experience an increase in income, leading to a rise in their purchasing power, which of the following scenarios best describes the impact on the demand curve for a normal good?
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Question 4How does an increase in consumer income typically affect the demand curve for normal goods, and what is the underlying reason for this shift?
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Question 5When consumer preferences shift in favor of a product, this results in a(n) __________ of the demand curve for that product.
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Question 6Increase in consumer income : outward shift in demand curve :: decrease in consumer preferences : ?
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7
Question 7Which of the following factors would cause a rightward shift in the demand curve for a luxury car?
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Question 8Arrange the following factors that can shift the demand curve in the correct order of their impact on consumer demand: A) Change in consumer preferences, B) Change in income, C) Change in prices of related goods, D) Change in population size.
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Question 9Which of the following factors can cause a shift in the supply curve for a product? Select all that apply.
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Question 10Which of the following factors would likely cause a rightward shift in the supply curve for smartphones?
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