A change in demand of a good is shown by a:
A) movement along a demand curve.
B) shift of a demand curve.
C) movement along the demand function.
D) shift of the demand function.

Question

Quizplus · Accepted Answer

A change in demand is caused by a shift of the entire demand curve, which occurs due to a change in any of the determinants of demand, such as consumer incomes, tastes and preferences, prices of related goods, demographic factors, or consumer expectations. Therefore, the correct answer is B, which refers to a shift of the demand curve. A movement along a demand curve only shows a change in quantity demanded due to a change in the price of the good, holding other factors constant, which is called a change in quantity demanded, not a change in demand. The terms demand curve and demand function are often used interchangeably, but a function is a mathematical equation that represents the relationship between two or more variables, while a curve is a graphical representation of that relationship. Therefore, choice C is not precise and refers to the same concept as A. Finally, the demand function is a type of demand curve that expresses the quantity demanded as a function of the price and other variables, and its shift is equivalent to that of a demand curve. Therefore, choice D is also correct but less common in practice.

A Change in Demand of a Good Is Shown by A