Assume the market in the graph shown was originally at equilibrium where demand (D) and supply (S) intersect. However, something causes the demand to shift to D₂. What could have caused such a shift? A) The good became more popular with consumers. B) Consumers expected the price of the good to drop in the near future. C) The good became cheaper to produce. D) Substitutes for this good became less expensive.

Question

Quizplus · Accepted Answer

The shift in demand to the right (D₂) indicates that demand has increased. This could be due to the good becoming more popular with consumers, which would lead to a higher quantity demanded at each price level, shifting the demand curve to the right.

Assume the Market in the Graph Shown Was Originally at Equilibrium