3.4 Market Effects of Changes in Demand
Figure 3.3
-Figure 3.3 illustrates the demand for tacos. Assume that tacos and burritos are substitutes. A decrease in the price of burritos would bring about a movement from

Question

3.4 Market Effects of Changes in Demand
  Figure 3.3
-Figure 3.3 illustrates the demand for tacos. Assume that tacos and burritos are substitutes. A decrease in the price of burritos would bring about a movement from

Quizplus · Accepted Answer

A decrease in the price of burritos, which are substitutes for tacos, would decrease the demand for tacos as consumers switch to the now cheaper burritos. This would be represented by a shift in the demand curve for tacos from D₂ to D₀, indicating a decrease in demand.