Answer to Question #178151 in Microeconomics for azhar khan

Question

. Does a change in consumers’ tastes lead to a movement along the demand curve or a shift in the demand curve? Does a change in price lead to a movement along the demand curve or a shift in the demand curve

Answer 1

The shift in demand occurs when there is a change in the quantity demanded at each possible price due to a change in any of the other variables that affect demand (for example, consumers’ tastes or consumers incomes). Therefore, the change in consumers’ tastes lead to the shift in the demand curve.

The movement along a demand curve occurs when there is a change in price, but no change in any of the other variables that affect demand (for example, income or population). Therefore, the change in price lead to a movement along the demand curve.