Question

Explain the distinction between change in quantity of a good demanded and change in demand. Be sure to state the factors that lead to these changes.

Answer 1

A change in quantity of a good demanded is the movement along the demand curve, where the consumer changes the quantity demand for goods as a result of changes in prices of a good, keeping all other factors affecting demand constant. Therefore, when price of a good increases there is a fall in quantity demand and a fall in price result to an increase in quantity demand, while change in demand refers to the shift along the demand curve, a shift of the demand curve shows the relationship between the demand and other factors that affect demand other than price.

These factors include the change in, consumers taste and preferences, consumer income,future price expectation, government policy and price of other related commodities, that is the substitutes and compliments.

References

Dr. Dewett, K. K., & Navalur,M. H,. (2006). Modern Economic Theory. S chand: Reprint Edn.