Question

explain the difference between a movement along a demand curve and a shift in demand curve. Give two examples of factors that can cause a shift in the demand curve.                                     

The two factors that can shift the demand curve are;

Answer 1

A movement along the demand curve is called 'change in quantity demanded' and this change in quantity demanded takes place only due to change in own price of the good while other factors remain constant.

A shift in the demand curve is called 'change in demand' and this change in demand takes place due to change in factors other than own price of the good. A shift in demand implies that at the same price the consumer now demands more or less of the good.

Two factors that can shift the demand curve are: change income of the consumer and change in price of substitute goods or complementary goods