3.3 Change in Quantity Demanded vs. Change in Demand
Notes
These two ideas sound alike but are different.
- A change in quantity demanded is caused only by a change in the good's own price. It is a movement along the demand curve.
- A change in demand is caused by any other factor (income, tastes, prices of related goods, expectations, number of buyers). The whole curve shifts.
- An increase in demand shifts the curve to the right: more is bought at every price. A decrease in demand shifts it to the left.
- Worked example: if movie tickets drop from $12 to $9 and more people go, that is an increase in quantity demanded. If a hit film comes out and more people want tickets at every price, that is an increase in demand.
Practice
The price of sneakers falls, and people buy more sneakers. This is:
The good's own price changed, so buyers move along the existing curve.
A famous athlete starts wearing a brand of sneakers, and sales rise at every price. On a graph, the demand curve:
A change in tastes is a non-price factor, so demand increases.
Which would cause a movement along the demand curve for apples rather than a shift?
Only a change in the good's own price causes a movement along its curve.
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