Answer to Question #312306 in Microeconomics for edem

Question

QUESTION THREE

With the aid of diagrams, explain the difference between increase in demand and increase in quantity demanded.

Answer 1

Increase in demand occurs due to change in factors other than price of the commodity. Increase in quantity demanded occurs due to change in price of the commodity. Diagrammatically this is shown by a forward shift in demand curve from DD to D₁D₁. Diagrammatically this is shown by a downward movement on the same demand curve from P₀ to P₁