Answer to Question #316334 in Microeconomics for Nobuhle Ledima

Question

In economic theory, a clear distinction is made between a movement along the demand curve and a movement of the demand curve. In light of the statement, provide the correct graph to illustrate and explain an increase in the price of the product

Answer 1

A movement along the demand curve

This is majorly caused by a change in the price of the commodity's own price. An increase in the price of such commodity (normal good) will cause the quantity demanded to decrease

A movement of the demand curve

This is caused by other factors affecting demand except for the commodity's own price.

A price increase does not affect the movement of the curve