Use the following to answer question(s): Simultaneous Shifts in Demand and Supply

-(Exhibit: Simultaneous Shifts in Demand and Supply) D₁ and S₁ are original supply and demand curves, and S₂ and D₂ are new curves.In this market for a normal good, the shift in the demand curve may have been a result of:

Question

Use the following to answer question(s): Simultaneous Shifts in Demand and Supply
 
-(Exhibit: Simultaneous Shifts in Demand and Supply) D₁ and S₁ are original supply and demand curves, and S₂ and D₂ are new curves.In this market for a normal good, the shift in the demand curve may have been a result of:

Quizplus · Accepted Answer

If consumers are expecting the price to go up, they may increase their demand in the present to avoid paying a higher price later. This would shift the demand curve to the right, from D₁ to D₂, resulting in a higher equilibrium price and quantity.

Use the Following to Answer Question(s): Simultaneous Shifts in Demand