Sol :
The Price of Computer memory chips rose in
2009.
This can be done in any of two ways :
- Increases In demand ,
Or
- Decreases in
Supply
INCREASE IN DEMAND
:
- If the demand increases of the goods due to any factors other
than price , then it will lead to shift the demand curve.
- So, if the demand increases for the product , then demand curve
must shift to the RIGHT.
- Shift in the demand curve will create a situation of excess
demand in the market. It will put a pressure on the prices and will
increase the prices.
- Shift in Demand curve to the right , will create a new
equilibrium at a point of higher PRICE AND QUANTITY.
DECREASE IN
SUPPLY :
- If the supply decreases due to any factor other than the prices
, it will lead to shift the supply curve
- When the supply of the goods decreases , it will shift the
supply curve to the LEFT.
- Shift in supply curve to the left , will create a situation of
excess demand over supply in the market, which will put a pressure
on the prices and will increase the prices.
- Shift in supply curve to the left , will make a new equilibrium
at HIGHER PRICES AND LOWER
QUANTITY.